The Lehman 20-year Treasury Bond ETF (AMEX: TLT) continues to grind to new 4-month highs….See our recent daily chart, in which we note that our near and intermediate-term work continue to "warn" us to expect another surge in the TLT that thrusts prices towards 89, which appears to be gaining upside strength as we speak. The weakness in the equity indices hardly can be considered acute, yet the long end of the yield curve is ratching down (lower rates) to reflect expectations of…what?

An economic slowdown?

Additional concerns about the housing and home building markets?

About another round of dislocations in financial institutions and hedge funds?

Maybe all of the above. Be that as it may, the TLT's are attempting to break out on the upside, above the March-August resistance line and towards a confrontation with the moderately negative 200 DMA. Let's expect upside continuation towards my optimal target zone in the vicinity of 89.

By Mike Paulenoff

Mike Paulenoff is author of the MPTrader.com (www.mptrader.com) , a real-time diary of Mike Paulenoff's trading ideas and technical chart analysis of Exchange Traded Funds (ETFs) that track equity indices, metals, energy commodities, currencies, Treasuries, and other markets. It is for traders with a 3-30 day time horizon, who use the service for guidance on both specific trades as well as general market direction

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