TNOTE2Y breaks back below 50-day moving average
U.S. 2-Year T-Note (TNOTE2Y) Technical Analysis Report for Jan 20, 2020 | by Techniquant Editorial Team
TNOTE2Y finished Monday at 107.742 losing $0.008 (-0.01%) on low volume. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (TNOTE2Y as at Jan 20, 2020):
Monday's trading range has been $0.016 (0.01%), that's far below the last trading month's daily average range of $0.078. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for TNOTE2Y. Prices continued to consolidate within a tight trading range between 107.688 and 107.773 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern and one neutral pattern, the Doji. The last time a Doji showed up on December 17, 2019, TNOTE2Y lost -0.03% on the following trading day.
The market closed back below the 50-day moving average at 107.746.
The contract shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could speed up should prices move above the nearby swing high at 107.766 where further buy stops might get activated. Selling could accelerate should prices move below the close-by swing low at 107.711 where further sell stops might get triggered. With prices trading close to this year's low at 107.672, downside momentum could speed up should 2Y T-Note break out to new lows for the year.
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. Though it is usually interpreted as neutral, it has actually shown to be bullish for 2Y T-Note. Out of 728 times, TNOTE2Y closed higher 47.12% 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 52.06% with an average market move of 0.02%.
With four out of the other four Bond Markets closing lower today, the ones that stand out on the negative side are TBOND losing -0.04% and BUND closing -0.03% lower. None of the markets managed to end the day in the green. Read more