T-Bond trading comment (July 19, 2007)

Today was a repeat of what we have seen lately... Yesterday we went up so today we went down, thus making very hard for longer term trend followers to keep positions unless you have pretty deep pocket or don't risk too much on each trade. However one thing remains, the 21 days moving average still holds as a support and we like that because it supports our view of a possible bottoming out. On the other hand, as long as we do not break the 108-05 resistance, tested three times already, we will not enter in any significant recovery.

Like yesterday, we had a relatively clear signal day for very short term traders. There were few signals but they were good ! On the other hand, longer intra-day trend followers will have found it a bit harder as the signals were a bit less good. Several trends developped without clear starting signals. Claims data was a tad stronger than anticipated, but leading indicators and the Philly Fed were both disappointing which helped the market reverse the downtrend. Yesterday, it was 107-24 that was the resistance, today it was 107-23 that was only broke after the Minutes of the FED were released and even there it was not super convincing as we are again under that level after the close. Also worth of noting is the fact that today's volume was pretty low.