USH10

The bonds exceeded a midpoint by enough to suggest that dual targets of 115^10 and 115^06 are coming.  Traders should focus on the lower of these two pivots. ______ UPDATE (10:54 a.m. EST): A smaller pattern has emerged on the hourly chart in which the midpoint has been surpassed, pointing toward the D target of 115^24.

If the bonds are going to reverse their recent downtrend soon, they might be expected to do so at a midpoint pivot of 116^15, which can be bottom-fished with a tight stop.  The associated D target is 115^01, an area that will bear watching, as the midpoint of a larger daily pattern sits at the 115^10 level. ______ UPDATE (02:47 p.m. EST): The bonds have moved up enough to cancel our 116^15 and 115^01 targets.

The last, minor correction cycle overshot its Hidden Pivot midpoint, so we should look to short this rally if and when it reaches its 'D' target at 120^02.  A stop-loss no wider than four ticks is all I'd allow, and I'd suggest initiating the trade only if there's an hour or more remaining in the session. _______ UPDATE:  Cancel the order, since weakness prevails for now.

My short-term outlook calls for perhaps another 2-3 days of corrective action before the futures attempt to take on resistance just above 119. If in the meantime they pull back to 117^31 without have exceeded 118^23 to the upside first, bid for a single contract at that price, stop 117^28. _______ UPDATE:  Bids at 117^31 would have been stopped out for a loss of $100 plus slippage, since the futures groped their way down to 117^23 before finding a temporary bottom.  The breach of the midpoint support is a bearish sign for the near term and suggests that more corrective action is likely.

The futures have pulped the 116^20 downside target given here a couple of weeks ago and now appear bound for at least 113^13.  The bonds could catch a bounce on the way down from 114^17, the Hidden Pivot midpoint of a long-term pattern, but if it gives way easily, that would shorten the odds that the lower target will be reached sooner rather than later.

The futures found little support yesterday at the 118^14 Hidden Pivot midpoint of the pattern shown in the chart, so we'll assume they're bound for that number's 'D' sibling, 116^20, at least.  The downtrend begun around Thanksgiving has unfolded with authority, and nothing less than an upthrust exceeding 120^14 will suffice to turn things around.

The signs are a tad too murky for me to endorse bottom-fishing at 118^09, but that Hidden Pivot can serve for the time being as a minimum downside objective.  If it gets trashed, however, the futures would be signaling more weakness over the near term to at least 117^10.  You can bracket these two targets with two more possibilities nearby:  118^11/117^15,