September U.S. Treasury bond futures (ZBU25) present a selling opportunity on more price weakness. 

See on the daily bar chart for September U.S. Treasury bond futures that prices are trending down and Thursday hit a contract low. See, too, at the bottom of the chart that the moving average convergence divergence (MACD) indicator is also in a bearish posture as the red MACD line is below the blue trigger line and both are trending down. The bears have the solid near-term technical advantage.

Fundamentally, Moody’s downgrade of the U. S. long-term credit rating spooked bond market bulls. The move by Moody’s followed similar moves by Fitch and S&P Global some time back. While the Moody’s debt downgrade was not a shocker, it was a stark reminder to the marketplace that the U.S. has a problematic debt burden. All it would take is a change in global investor perceptions on what amount of U.S. government debt is untenable to start the financial market dominos falling. 

The marketplace is jittery late this week following a U.S Treasury 20-year bond auction at midday Wednesday that was not well received by investors. Barron’s today said: “The bond market is the older, wiser sibling of the stock market, and it doesn’t often have a moment. But when it does, watch out.” 

The U.S. Treasury market also does not like the tax and spending bill backed by President Donald Trump’s administration that is advancing through Congress. The Congressional Budget Office said the bill will increase the U.S. budget deficit by $3.8 trillion between 2026-2034. 

All of the above factors are bearish for U.S. Treasury bond futures.

A move in September T-Bond prices below chart support at Thursday’s contract low of 109 20/32 would become a selling opportunity. The downside price objective would be 102 even, or below. Technical resistance, for which to place a protective buy stop just above, is located at this week’s high of 113 6/32.

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any trades and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%): 

Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.