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May 5, 2005

Buy Treasury Bonds

On April 28th, due to my perception the Bonds might be vulnerable going into last week's Fed meeting, I temporarily exited 100% of my Treasury Bond positions accumulated since my original buy recommendation on January 5th.

Since taking that money off the table, two "major" events have taken place.....One, the Fed raised short term rates another 1/4 %, and two, the Fed totally surprised everyone yesterday by announcing they will probably soon start issuing 30 Year Treasury Bonds again....According to the the economic "experts" who have been predicting a bear market in Bonds for over a year now, both of those events (especially the surprise 30 year announcement, representing new supply) should have sent Bonds tumbling off a cliff.....All I can say is, Bonds DID sell off about 1 1/2 points, for all of 30 minutes, then turned straight back up, and closed today exactly where they were going into the Fed meeting this past Tuesday....

If this most recent double barrelled news did not push Bonds down, WHAT WILL?...I continue to believe Bonds are in a bull market and once again strongly recommend buying this market. I may be dead wrong, but I believe Bonds are about to turn dynamically higher....and would not be the least bit surprised ( and I mean this) to see them 8 to 10 points higher, or $8,000 to $10,000 per futures contract, before the June contract expires 46 days from now on June 21st....

I am re-establishing this position using the September contract shown below.

If you are interested, give me a call.....and again, I may be dead wrong, but I would absolutely say, "the SOONER the better....".


Bill Rhyne


5-5-05june05bonds.gif (13014 bytes)


I think they could begin moving sharply higher on any given day now....I have to say I have felt this way for several months now...

5-5-05sept05bonds.gif (11834 bytes)



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