Sunday, July 29, 2012

TLT 20+ Treasury Bonds IShares

I seldom wade into the perplexing Treasury Markets but some interesting patterns are emerging on the weekly charts:

Two formations are shown in the first chart: The 2 squares from the 2010 decline AB and the 2010-2011 advance BC
  • The blue fan lines generated from the AB square indicates major support just above 125 with secondary support shown by line AE.
  • Note that the second square terminates at point E--which is in the month of August.
  • The radius BC = radius BD.
  • Points E & D could mark the time period of a major change in trend. (August 2012). Note how the arc C-D contained price advances during the decline of 2011. This cycle terminates in August.  

  • The conventional technical chart is showing that TLT is nearing over-bought and could be showing a RSI non-confirmation.
  • The decline of 2011 BA is equal to BC. Point C is near the recent high and subsequent bearish engulfing line. AB = BC
  • 125 is important support since it was the 2011 High and recent corrective low.
  • The DMI is showing signs of exhaustion and is in a position to indicate the end of a major bullish trend.
  • Support is at 125 and 110.

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