Drop Expected In The iShares 20+ Year Treasury Bond Fund ETF (TLT)

buyers and sellersTrading Central: From a technical view, the ETF is shaping a major Head & Shoulders pattern on a weekly chart which is a reversal one.

Regarding technical indicators, both the 20-week and the 50-week moving average are reversing down and call for a drop. Furthermore, the weekly MACD is going to push below its signal line increasing downward momentum.

On a relative basis against the IVV S&P500, the iShares 20+ Year Treasury Bond Fund has validated a key triangle and looks set for an important down move.

Trading strategy:
Short Sell @ $117.34 – Stop loss @ $122.5 – Target @ $98

Ratio TLT versus iShares IVV SP 500

UNDER PRESSURE

tlt1

tlt2

Glossary


MACD: this indicator (Moving Average Convergence / Divergence) reflects a difference between moving averages and refers to the ascendancy or not of the mid-term relative to the short term. The considered average lengths are respectively 26 days (0.075 exponential coefficient) and 12 days (exponential coefficient of 0.15). RSI: (Relative Strength Index) a technical indicator which measures the magnitude of gains over a given time period against the magnitude of losses over that period. The equation is RSI = 100 – 100 / (1 + RS) where RS = (total gains / n) / (total losses / n) and n = number of RSI periods


For more information on iShares ETF go to:
http://us.ishares.com/home.htm

Disclaimer

The information contained in this publication is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Any opinion offered herein reflects TRADING Central current judgment and may change without notice. Users acknowledge and agree to the fact that, by its very nature, any investment in shares, stock options and similar and assimilated products is characterised by a certain degree of uncertainty and that, consequently, any investment of this nature involves risks for which the user is solely responsible and liable.

Services in the U.S. are offered through TRADING Central Americas, Inc. SEC Registered Investment Adviser (IARD/CRD 801-67210)

This message is intended for recipient only and not for further distribution without the consent of TRADING Central. Although TRADING Central attempts to sweep e-mail and attachments for viruses, it does not guarantee that either are virus-free and accepts no liability for any damage sustained as a result of viruses.

Leave a Reply

Your email address will not be published. Required fields are marked *