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Retired chief investment officer and former NYSE firm partner with 50 plus years experience in field as analyst / economist, portfolio manager / trader, and CIO who has superb track record with multi $billion equities and fixed income portfolios. Advanced degrees, CFA. Having done much professional writing as a young guy, I now have a cryptic style. 40 years down on and around The Street confirms: CAVEAT EMPTOR IN SPADES !!!

Tuesday, June 09, 2009

Long Treasury Bond

The bond is sharply oversold and advisory sentiment -- usually
wrong at key turning points -- has dropped into the upper
reaches of "too many bears" territory. The bond price is hovering
just above important support. Conditions continue to fall into
place for what could be a sharp counter-trend rally.

The long Treasury remains very sensitive to the trend of industrial
commodities prices, which are in a clear uptrend now. So, what is
needed now is a spot of negative news on economic recovery
prospects to shake the industrials market into a round of profit
taking. That would serve to rally the T-bond.

Long bond chart here.

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