Farang

Basically, the futures contracts are standardized at a 6% coupon security with a $100 face value . The price of 123 represents the value of a 5 year treasury note with a coupon of 6% that is yielding 0.77% + cost of carry. The price of a bond moves inverse to its yield. So as yield drops from 6% to 0.77% the price of the bond or note moves from 100 to 123. For more info google DV01, "bond duration" and yield to maturity. Im simplifying here, in reality there is a little more to it. Firstly amount that the bond rises in relation to the yield is a convex function. If you want to find out more about this google "bond convexity", you need to understand some basic calculus. Secondly, the underlying for the futures contract is based on a basket of similar bonds. The price represents to cheapest to deliver of the bonds in the basket.Google "Cheapest to deliver" or "CTD treasury futures" This might help: U.S. Treasury Futures Conversion Factor Look-Up Tables Basically all the info you need you can find on CME website and wikipedia.

I agree too. You will be far better off just reading the original course uploaded on here. Its one of the greatest books on trading ever written.