IEF dominated by bears dragging the market lower throughout the day
iShares 7-10 Year Treasury Bond ETF (IEF) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, IEF ended Wednesday at 121.77 losing $0.07 (-0.06%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (IEF as at Sep 16, 2020):
Wednesday's trading range has been $0.34 (0.28%), that's slightly above the last trading month's daily average range of $0.32. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for IEF.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on September 4th, IEF actually gained 0.21% on the following trading day.
After trading as low as 121.66 during the day, the market found support at the 100-day moving average at 121.75. Prices are trading close to the key technical resistance level at 121.88 (R1).
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could speed up should prices move above the close-by swing high at 122.10 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 121.44 where further sell stops might get triggered. Further selling could move prices lower should the market test August's close-by low at 121.18.
Among the seven 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 728 times, IEF closed higher 56.18% 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 56.18% with an average market move of 0.16%.