30 Year US T-Bond Analysis June 2017 (W,W)
Created on Thursday, 01 June 2017 00:46
Written by Austin Galt
Let’s review the charts of the 30 Year US T-Bonds as there are a couple of scenarios I am looking at going forward from here. Let’s begin with the big picture quarterly chart.
30 YEAR US T-BONDS QUARTERLY CHART
We can see the “three strikes and you’re out” top formation in place. I favour this has ended the 35 year bull market. A final fourth strike high is certainly not out of the question though.
The Bollinger bands show price is back at the middle band and I expect support to kick in here and send price back up to test the high. The only question I have is will it be a marginal false break high or a secondary high. I currently favour the latter although my mind is open to both possibilities.
The Fibonacci Fan shows the high clipped the 61.8% angle and I do favour that to be the final high. However, I suspect price will get back up to the 61.8% angle before turning back down.
The RSI shows five bearish divergences in place. Is a sixth bearish divergence possible? Sure.
The MACD indicator showed a new high together with the all time price high. Just as the 1981 all time low was accompanied by a new low.
30 YEAR US T-BONDS WEEKLY CHART
Now, there is the potential for a 5 point broadening top to form as the recent lower low could well be a point 4 low only. That is not my expectation but it is worth keeping in mind. Instead, I favour a deep retracement which so often happens with the first bear rally in a new bear market.
I have added Fibonacci retracement levels of the move down and I am targeting price to rally up to at least the 76.4% level at 169.93. The 88.6% level at 173.76 is also an area to focus on.
I have drawn a Fibonacci Fan and I favour the major secondary high to form around the 88.6% angle. That looks to intersect the 76.4% level towards the end of 2017 so that is some potential timing.
The RSI is now trending back up making lower lows and lower highs as is the MACD indicator.