And the BMO analysts add the.........>

US TSYS/SUPPLY: And the BMO analysts add the positioning data's "obvious

implication" is that "while we're not quite ready to call a top in yields and

the 2.40% level is seen holding (for now), we're more cognizant of the notion

that the short base is building and helping to establish what will likely be an

eventually much stronger rally."

- They also add that the "jammed (auction) supply schedule this week should help

to put some further upward pressure on yields. Combined with the positioning

data, we're more confident that this latest market move will resolve in a rally.

Our favored strategy is to come out of the auction process long to take

advantage of any concession that gets priced in for supply and we'll likely look

to the end of this week to initiate that view, especially if the key level of

2.40% is broken on the back of supply concessions."