Which of these bonds is the most bearish?

The Technical Trader’s view:

TNotes: US TNOTE JUN 09 DAILY BAR CHART

The drama of this market lies in the pullback through the alltime- highs that was simultaneous with the completion of a clear Double Top/ Continuation Head and Shoulders.The clear and minimum move suggested by the Top is measurable down to 112-16 or so. (The target is the same for both patterns.)

Bunds: BUNDS JUN 09 DAILY CHART

This Triple Top has completed too. And the All-Time-High acted as more of a resistance level. Now left far behind. But note well that the long-term support from prior Highs remain beneath the market. The minimum move implied by the Triple Top is as far as 115.50. But the 118.50-90 band of support should not be underestimated. It may not reverse the move to the downside. But may slow it up.

Yen Bonds: YEN BOND JUN 09 DAILY CHART

This is altogether different. The Yen market never made it back up to the All-Time-High. A small Triangle may have completed: suggesting move down as far as 135.50. Certainly we can say that the bear market in the Yen bonds is concurrent with western markets, yet lacks a clear Top formation to add energy to the bear moves.

We are clear that all three of these markets are bearish in the long and medium term. In the very short term, the Bund and TNote may both be oversold. But overall, the US TNotes represent the most compelling bear case.

Mark Sturdy Seven Days Ahead

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