Technicals Indicate Big Upside Could Be Ahead For Bonds

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May 17, 2017 11:52am NASDAQ:TLT

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From Chris Kimble: Bonds have been hit hard since the highs around the 4th of July last year. Could this big decline, be creating a bottoming pattern? Is it bottoms Up for bonds?


Below looks at the pattern of TLT (long-term Treasury ETF) over the past couple of years:

Last summer when bonds were peaking, it was easy to find bond bulls, as bullish sentiment for bonds stood at 90%. Today it’s not so easy to find bond bulls!

TLT could be attempting to create a reversal pattern (inverse head & shoulders) following a 20% decline from the highs. The inverse head and shoulders pattern is far from proven at this time, however. If TLT would break above neckline resistance, it would increase the odds that this reversal patterns is important to the bond market.

The iShares Barclays 20+ Year Treasury Bond ETF (NASDAQ:TLT) was trading at $122.82 per share on Wednesday morning, up $1.31 (+1.08%). Year-to-date, TLT has gained 3.10%, versus a 6.28% rise in the benchmark S&P 500 index during the same period.

TLT currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #19 of 27 ETFs in the Government Bonds ETFs category.


This article is brought to you courtesy of Kimble Charting Solutions.


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