Bunds remained in a narrow range yesterday, although the small upward moves saw the
market unwind the severe oversold conditions evident on the 60 min charts. This morning the chart pattern looks quite bullish and we should see this come higher if we can hold the 131.95/91 support.
Buyers should be in at these lower levels and they should only reverse position if we make a break below 131.86. If this occurs look for 131.76/73.
Now if we hold support we should be able to trade higher with 132.37/40 once more targeted. If we can break the 132.40 barrier buyers would be expected to come back into the market looking for a rally towards 132.60 then 132.73.

Bobl held support and came higher to target area of 122.24, seeing long positions covered. Today we still have the 122.28 resistance to negotiate and of we can break this region then we can go forward to 122.41 initially.
Here we look to cover all longs once more. Sellers are likely to be waiting on these highs
and it is up to the buyers to try and bust through this point, keeping the pressure then to the topside for 122.51/55.
Support is at the 121.85/82 region. A loss of this support still sees the market lower with 121.65/62 as your first target with a break signalling 121.53.

Gilts will need to regain ground above 123.86 for a run up to 124.15/17. The market should pause here but there is scope for gains to 124.40/42 today. Watch for profit taking here as sellers attempt shorts at this stage today. Only a break above 124.50 activates stops on shorts as we head for the next target for the day at 124.66/70. Don't expect much more on the upside for today.
Failure at 123.86 could lead to prices drifting back towards 123.59/52 and perhaps another test of Friday's lows at 123.37 but this should meet with keen buyers once again today. They will wish to add to longs down to 123.25 but below 123.20 activates stops as this signals further losses with 122.71/68 the next target.