Last gasp for bond futures uptrend?

You would be hard-pressed to find any market that has been hotter than Treasury futures during the last few weeks. But are the first signs of the end of an uptrend to unprecedented levels beginning to show up?

-The Fed has lowered short-term interest rates to nearly 0% so there is virtually no room to go lower (as interest rates go down, futures move up).

-Rates for 30-year T-bonds are not the same as the Fed funds rate, but T-bond rates have also dropped to historic lows. How much lower can they go – or how much higher can bond futures go?

-After making a bullish moving average crossover to the upside on the VantagePoint chart in early November, T-bond futures moved to record levels almost without a pause. But no market goes up forever, and this one would clearly seem to be overbought.

-Bond futures prices have settled down a bit, causing the first pause in the uptrend of VantagePoint’s predicted medium-term moving average (1).

-VantagePoint’s predicted neural index (gray line) has shifted to 0.00 (bearish) after being at 1.00 (bullish) for nearly a month (2).

-VantagePoint’s predicted short-term difference (red line) and predicted long-term difference (green line) have also turned down, another bearish clue (2).

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