Current market focus:
Yield rates: 10-year Treasury note and 30-year Treasury bond
Treasury note and bond funds: IEF is 7-10 year and TLT is 20+
year Bond fund.
U.S. stock market: NASDAQ-100, QQQ
Commodity Indices - Goldman Sachs (GI-) and CRB (CR-)
By the end of last week, the 10yr. T-note yield rate closed
slightly higher, at 4.791%. The T-bond yield rate closed nearly
unchanged for the week, at 5.465%.
This week, the yield rate of the T-note and the T-bond are
in the June ‘03 rising trend but they are too advanced and
should pull-back in a correction. The current rise potential
is likely to be limited and followed by a downward correction.
Ultimately, the Note could go down to 4.2% or 3.739%; the Bond
will eventually correct down to 4.972% or 4.689%.
By the end of last week, the Amex listed IEF (7-10 year T-note
fund) closed the week at five cents lower, $81.70. The TLT (20+
year T-bond fund) closed the week at two cents lower, $81.48.
The IEF and the TLT are in a falling trend but each is oversold
and due to rally. The IEF may go back up to 85.20 or 87.55; the
TLT may go back up to minimum of 89.55.
By the end of last week, the 30-year T-bond (cash index) closed
(-)5/32 lower for the week at 98-22/32.
This week, the T-bond is approaching completion of what appears
to be a March to May decline. The Bond is building a base of
support in the area of 97-16/32 to 98-11/32. Eventually, it will
rise back to the former range of 106 to 112.
By the end of last week, the NASDAQ-100, QQQ closed up for
the week, at $36.84.
The QQQ has been in a rising trend since October of 2002.
But, since January of this year, the QQQ has been in the falling
trend of a correction. Since the week of 5-17-04, the QQQ has
been in a rising trend. It to remain viable, it must continue
higher and rise and hold above $38.60. Current range of downside
risk is to $33. If the current rally fails and does not hold
above $33., the correction trend may deepen and bring the QQQ
as low as $24.
The Goldman Sachs commodity index (GI) and the CRB index have
been in a rising trend since January of 2002. Last week, the
GI closed lower for the week, at 292.20 and CRB closed lower,
at 269.93. Both had become overextended in recent weeks . Now,
they are correcting, downward. The GI is more extended, with
greater downward potential. Increased demand is sustaining prices
for raw materials and indicating continued economic growth. Crude
oil is the major component of the increase in commodity index
prices.
J. S. BICKFORD >>>>>>
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