US TNote Future June 2009

Comment: TNote prices are at their lowest this year, yet still well within normal retracement parameters. This has steepened the yield curve by more than we had allowed for though simultaneously narrowing the yield gap over German paper as expected. Price action this year is seen as a ‘flag’ and another rush higher ought to be imminent. We continue to favour a squeeze back up to 125.00 and then more slowly to contract high at 126.24. Strategy: Buy at 120.24; stop below 120.00. Add to longs on