March Treasury Bonds are down 15/32 at 116:13 this morning as I write.  The included chart shows that yesterday, March T-Bonds closed below the important support in the 117:00 area.  Today, we are witnessing some downside follow through from that weak close yesterday.  The double top at 123:00 measures down to the 111:00 area for a downside target.  The textbook way to get that downside target is to measure from the double top at 123:00 down to the neckline at 117:00 which is 6 full points.  Subtract that 6 points from the neckline of 117:00 and you get a downside target for the T-bonds of 111:00.  This will be just fine for those of you who have all of my recommended bond put trades on at this time.  The directional movement indicators are bearish and the ADX line is rising again confirming the strength of the downtrend. 

 Followers should be:

 Long one March Bond (114:00 strike) put option from 2 12/64. (Cost basis of 28/64, or $437.50, if you include the buy back of the two short 110:00 put options on December 8th).

Long one March Bond (108:00 strike) put option from 52/64.  (Cost basis of 2/64, or $31.25, if you include the buy back of the two short 105:00 put options on December 8th).

Long one March Bond (117:00 strike) put option from 128/64.

Short one March Bond (113:00 strike) put option from 51/64.

March options expire in 59 days.

 David Hall

 The information and opinions contained herein comes from sources believed to be reliable, but are not guaranteed as to accuracy or completeness. The risk of loss in trading futures and/or options can be substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results.

 This newsletter is not intended for dissemination to the public without prior approval from David Hall.