The second half of the year has traditionally been a period of falling Treasury yields. Why a pronounced seasonal should exist is a mystery to me but it what it is and shorting into year-end is generally a losing trade. I am still holding to my earlier stated view that 10-year yields could drop back below 3% before the real bear market gets underway -- and there is every signal that the secular bull market in bonds dating back to 1982 is coming to an end. The 60-minute bar chart of 10 -year yields(see below) shows the market turning down in yield (obviously up in price). Getting back below 3.5% is the high odds bet but buying further out of the money calls expiring in December or January has good risk/reward characteristics. Volatility is low, the forward pricing is for higher yields so out-of-the-money spot is even further out-of-the-money against the forward -- on other words, calls are a relatively cheap play. (remember -- this is my opinion, no guarantees, and you make up your own mind with your own money).