Bobl March contract Forecast for 31st January 2013

March Bobl held below 125.76/80 resistance and above 125.19/16 support. The market looks like it can remain under pressure with a little support at 125.28/26 then Jan lows at 125.19/16. The market looks weak and so a break is a very strong possibility to target 124.90. Now this is more important being a 23.6% correction of the rally from the 2011 low at 113.79. It is not worth holding shorts any further even though the market is not severely over sold, as there is a danger of a sharp bounce from here after 5 consecutive weeks of losses so far. Further support below here from October lows at 124.81/79 but below here we risk a further collapse to 124.68/67 on the way to 124.48/44.

Resistance at 125.53 today then yesterday’s high at 125.63 before 125.76/80 which is the main obstacle. If however we break 125.80 today, look for 125.94 with a selling opportunity at 126.13/19.