Bund: Oversold In The Short Term

Bund failed to make it to resistance at 142.62/64 and the 4 month up trend line and broke lower as feared to hit the target of 141.65. We bottomed here at 141.61, just keeping us above the 1 year trend line and 55 week moving average.

We are a little over sold in the short term and having held this strong support level there is a hope we can see a recovery today. Above 141.95 allows a test of 142.19 resistance. This may be all we can manage today but a break higher should target 142.52/60. It should be worth us exiting longs here and perhaps trying shorts with little chance of any further gains but stops needed above 142.85 for 143.12/22.

A break of good support at 141.65/60 is significant. Being a 1 year trend line. We should then see a test of the daily 61.8% Fibo- nacci support at 141.39/37. Watch for a low here today but go with a break looking for 141.14/08. This is a 50% correction of the rally from 2012 double bottom lows at 135.27 and as such should provide good support today.