Interest Rates Bump Up Against 20-Year Resistance (TLT)

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June 15, 2018 6:06am NASDAQ:TLT

Technical analyst Chris Kimble charts a possible multi-decade breakout in interest rates.

The chart above looks at the yield on the 10-year note (TNX) over the past 25-years. The long-term trend is down as an important trend test is in play currently.

The 10-year yield has spent the majority of the past 20-years inside of falling channel (1). They have also spent the majority of the past 6-year inside of sideways trading channel (2), as rates are currently at the same level they hit in 2013.

Yields are now testing the top of the 25-year and 6-year channels at the same time at (3), with momentum now at levels last seen nearly 20-years ago.

One thing for sure is this….Bond bulls do not want to see dual resistance break at (3), as it would signal a major trend change in rates.

Will it be different this time for rates? Rates are testing one of the most important price points in a long, long time, so keep a close eye on what they do at (3).

The iShares Barclays 20+ Yr Treas.Bond ETF (TLT) was unchanged in premarket trading Friday. Year-to-date, TLT has declined -4.39%, versus a 4.87% rise in the benchmark S&P 500 index during the same period.

TLT currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #12 of 28 ETFs in the Government Bonds ETFs category.

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

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