The upward momentum in the 30-Year is regaining traction as U. S. equities plummet in reaction to the bad news concerning the auto makers and banks. Investors are running to the Dollar and U. S. debt for safety as the outlooks for the EU and Britain darken.

Furthermore, China is losing a little bit of its swagger since a deteriorating global economy will undoubtedly have a negative impact on its economy.

Additionally, we can't forget the Federal Reserve is officially participating in quantitative easing, meaning the U. S. government will protect the interest payments of U. S. debt at all costs. Hence, the 30 Year futures are strengthening in the hope that the excess supply of U. S.

Treasuries used to fund the nation's economic initiatives will be taken care of one way or another. Therefore, we expect the 30 Year futures to exhibit a normal, negative correlation with U. S. equities unless the Treasuries receive a negative demand shock or the auctions turn sour.

The futures are comfortably above our medium-term downtrend and we anticipate large near-term gains if they should climb back above our 130.56 resistance.

Fundamentally, we find resistances of 130.05, 130.56, 130.97, and 131.55. To the downside, we see supports of 129.41, 128.98, 128.52, and 128.06. The 30 Year T-Bond futures are currently trading at 129.22.

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