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Generally, the compelling case for bonds is negative when I look at
futures and mutual fund corporates. Support on the monthly channel from
1981 is 88-16 and the overall structure suggests to me that support will
fail within the next 3-6 months. The Nov rally was the first correction
to the decline which began Oct98 and it lasted only 4 weeks, not long
enough to be considered a convincing w.4 correction, thus the current
decline is probably not a final w.5. More likely scenario, is that w.4
began 25Oct and we may be completing a w.B (simple 3 wave structure)
decline. Daily chart shows pretty fair support right in here between
91-00 to 90-23. If it holds in here we will likely see a rally to 92-93
area. Rally above the 93 area would suggest a w.C rally and prices
should proceed to 96-100 before another impulsive decline begins.
Failure to hold here or a rally failure around the 93 area would
indicate that an impulsive decline, either an extended w.3 or final w.5
is already underway. As always, any such analysis is one of
probabilities rather than certainties.
Bonds have been very sloppy (no buyers) and open interest has been
declining steadily since mid-November suggesting light interest in
carrying over Y2K. Yesterday was an outside day which attempted an
upside reversal, failed badly, and closed at the lows. The daily chart
would require a 38+ tick rally today (Wed) to reverse convincingly. AGet
is showing an MOB support structure here in time and price, so I'm
watching to see if we can consolidate (perhaps an inside day or two) and
then rally. Overall bonds are very dicey. From my perspective, anyone
with a horizon longer than a few hours or days should probably be
positioned per the weekly and monthly trend. Under my investing hat, my
bond fund positions are pared to minimum. Under my futures trading hat,
I am reluctant to initiate fresh shorts at this level and will be
watching to see if there is enough support here to launch a rally.
Earl
----- Original Message -----
From: Dr. John Cappello <jvc689@xxxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Tuesday, December 21, 1999 10:29 PM
Subject: [RT] Treasury Bonds
> To T-Bond Afficionados:
>
> Need some insight as to potential bond price movement [direction and
range]
> over the next 30 days as you see it.Just looking for some
understanding
> since some of the factors I used to look at do not seem to matter any
more.
>
> Thanks for any info,
>
> John
> ______________________________________________________
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>
>
>
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