German Government Bonds continue to languish aimlessly in a down-trending channel. The gradual convergence of the moving averages tells us that the market may be close in time to a decision point. Unless the market confidently closes above this channel, it can be assumed that Bunds are topping out in earnest.

The fundamental story behind Bunds is that the rest of Europe sees Germany as the safe haven. This assumption is based on economic political correctness, which refuses to acknowledge the flawed design of the Euro             . Thus, whilst the Euro             has largely fallen in the same time period, Bunds have benefited from ignorance.

The play will be the short side. It is possible that we are now rounding over. Confirmation will be provided by a break of the channel lows.

We are within a consolidation, so caution is still advised.