TNOTE2Y enters Golden Cross for the first time since October 19, 2017
U.S. 2-Year T-Note (TNOTE2Y) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
TNOTE2Y ended the week -0.12% lower at 106.023 after gaining $0.062 (0.06%) today. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (TNOTE2Y as at Jan 11, 2019):
Friday's trading range has been $0.109 (0.1%), that's below the last trading month's daily average range of $0.141. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for TNOTE2Y. Prices continued to consolidate within a tight trading range between 105.922 and 106.102 where it has been caught now for the last three trading days.
One bullish candlestick pattern matches today's price action, the Tweezer Bottom.
Prices are trading close to the key technical resistance level at 106.094 (R1). After having been unable to move lower than 105.961 in the previous session, the market found buyers again around the same price level today at 105.961. The last time this happened on Wednesday, TNOTE2Y actually lost -0.05% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term. With its 50-day moving average crossing above its 200-day moving average, the contract has entered a so-called "Golden Cross" for the first time since October 19, 2017. Showing increasing upward momentum in the short and medium-term the "Golden Cross" is known to indicate a potential bull market on the horizon.
Buying might accelerate should prices move above the close-by swing high at 106.102 where further buy stops could get triggered. Selling might speed up should prices move below the nearby swing low at 105.922 where further sell stops could get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for 2Y T-Note. Out of 726 times, TNOTE2Y closed higher 47.38% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 53.58% with an average market move of 0.02%.
With four out of the other four Bond Markets closing higher today, the ones that stand out on the positive side are TBOND gaining 0.52% and TNOTE10Y closing 0.26% higher. None of the markets ended the day in the red. Read more