IEF closes below its opening price unable to hold early session gains
iShares 7-10 Year Treasury Bond ETF (IEF) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, IEF ended Thursday at 120.09 gaining $0.29 (0.24%) on low volume. Trading $0.31 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (IEF as at Mar 26, 2020):
Thursday's trading range has been $0.59 (0.49%), that's below the last trading month's daily average range of $1.86. 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 IEF. Prices continued to consolidate within a tight trading range between 119.26 and 120.50 where it has been caught now for the last three trading days.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on February 27th, IEF actually gained 1.12% on the following trading day.
Prices are trading close to the key technical resistance level at 120.68 (R1). After having been unable to move above 120.26 in the prior session, the ETF ran into sellers again around the same price level today, failing to move higher than 120.50.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the nearby swing high at 121.06 where further buy stops could get triggered. Selling might accelerate should prices move below the close-by swing low at 119.26 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for IEF. Out of 704 times, IEF closed higher 55.54% 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 55.82% with an average market move of 0.16%.