TLT runs into sellers around 165.68 for the forth day in a row
iShares 20+ Year Treasury Bond ETF (TLT) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
TLT ended Thursday at 163.34 edging higher $0.80 (0.49%) on low volume. Trading $1.69 higher after the open, the ETF 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 (TLT as at Mar 26, 2020):
Thursday's trading range has been $3.40 (2.07%), that's far below the last trading month's daily average range of $7.31. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for TLT. Prices continued to consolidate within a tight trading range between 160.41 and 166.68 where it has been caught now for the last three trading days.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on March 13th, TLT actually gained 6.48% on the following trading day.
Prices are trading close to the key technical support level at 159.70 (S1). Prices are trading close to the key technical resistance level at 166.15 (R1). The market was sold again around 165.68 after having seen highs at 166.68, 165.45 and 166.69 in the last three trading sessions. Obviously there is something going on at that level.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could speed up should prices move above the nearby swing high at 166.68 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous three Highs" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for TLT. Out of 4 times, TLT closed higher 100.00% 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 50.00% with an average market move of 1.64%.