TBT finds buyers around 15.64 for the third day in a row
ProShares UltraShort Lehman 20 Year Treasury (TBT) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, TBT ended the month -1.55% lower at 15.90 after gaining $0.16 (1.02%) today. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Monday's high at 15.81, ProShares UltraShort confirmed its breakout through the previous session high after trading up to $0.17 above it intraday.
Daily Candlestick Chart (TBT as at Jun 30, 2020):
Tuesday's trading range has been $0.34 (2.17%), 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 higher than usual for TBT.
In spite of a weak opening the ETF managed to close above the prior day's open and close, forming a bullish Engulfing Candle. The last time this candlestick pattern showed up on May 15th, TBT gained 4.49% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Tweezer Bottom and the White Candle which are both known as bullish patterns.
The market found buyers again today around 15.64 for the third trading day in a row after having found demand at 15.64 in the previous session and at 15.63 two days ago.
TBT shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling might accelerate should prices move below the close-by swing low at 15.63 where further sell stops could get triggered. Further selling might move prices lower should the market test May's nearby low at 15.27.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior two Lows" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for ProShares UltraShort. Out of 61 times, TBT closed lower 59.02% 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 60.66% with an average market move of -1.43%.