TNOTE5Y closes higher for the 4th day in a row
U.S. 5 Year T-Note (TNOTE5Y) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, TNOTE5Y ended the month 0.34% higher at 126.164 after surging $0.141 (0.11%) today on high volume. This is the biggest single-day gain in over a month. Today's close at 126.164 marks the highest recorded closing price ever. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Thursday's high at 126.070, the market confirmed its breakout through the prior session high after trading up to $0.094 above it intraday.
Daily Candlestick Chart (TNOTE5Y as at Jul 31, 2020):
Friday's trading range has been $0.172 (0.14%), that's above the last trading month's daily average range of $0.140. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for TNOTE5Y.
Two candlestick patterns are matching today's price action, the Bullish Closing Marubozu and the White Candle which are both known as bullish patterns. The last time a Bullish Closing Marubozu showed up on January 2, 2019, TNOTE5Y gained 0.37% on the following trading day.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back down towards the center of the Bollinger Bands at 125.794.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close above the upper Bollinger Band" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for 5Y T-Note. Out of 165 times, TNOTE5Y closed lower 58.18% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 55.15% with an average market move of 0.02%.
With three out of the other four Bond Markets closing higher today, the ones that stand out on the positive side are TBOND gaining 0.19% and TNOTE10Y closing 0.12% higher. On the flipside the worst performer has been BUND closing -0.13% lower. Read more