Chicago Board of Trade ten-year Treasury note futures have rallied 'big' on back to back days gaining 1.2% to close out last week at 111-11. On Friday the market crossed above a 52-week high for the first time since Sept. 7, 2007. The ten-year T-note futures may have broken the resistance line and primed itself for a breakout move.
Q: How have T-notes responded to back to back 'big' gains that push above the 52-week highest high?
A: According to the 10 previous occurrences of this event omitting any repeat occurrences within 10 trading days, EventEdge indicates that T-notes have shown a strong bullish edge that peaks 20 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the most recent occurrence of the event (Friday, Nov. 2, 2007) is Monday, Dec. 3, 2007.
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T-notes have rallied in 80% of the cases (8 of 10) by an average of 2.9% relative to the close on the event date. The average of the two declines is -0.3%. The overall return of the 10 cases is 2.2%, which, based on the close on the event date (111'11), provides a target price of 113'25.
If you would like to see more details of this historical edge, go to www.markethistory.com
Mickey Schoenhals is an analyst with Markethistory.com.
