TLH, TLT, TNX, TYX updates 05/22

TLH: Price reached the lower end of the ideal b-wave target zone and price has since moved down in an impulsive matter and broken below the long term lower uptrend line. Both are bearish developments: the long term trend is over. Simple. I anticipate soon a bounce for (red) intermediate-b, doing a possible retest of that trendline -failure (classic) and then wave-c down to the projected price target of around $114. This price target I’ve had for months, (red bars) and nothing has changed my perspective that these bonds have topped long term.

tlh

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TLT: Same deal as TLH (obviously). Long term top is most likely in. Here price didn’t even reach the lower end of the ideal wave-b target zone I’ve had for months, and also here price broke below the long-term uptrend line in place since 2011. Both are bearish developments. Also here we can count an impulse down off the b-wave high and a bounce can be expected soon. I anticipate it will reach back to the $122.75ish level after a touch off the 115.35 level. From that higher level, we can expect a c-wave down reaching as low as $95 for a standard c=a relationship.

TLT

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TNX: Treasury yield is on the rise and has likely struck a multi-decade low. From an economical perspective, this means since Treasury yield is the interest rate the U.S. government pays to borrow money for different lengths of time, the U.S. government will have to pay more: http://www.usdebtclock.org/. What this will do to the economy etc is a story for a different time. The chart below tells the story on why TNX has most likely bottomed. IF an impulse up develops (too little data available to know) then we should be looking at ideally at $40 for a wave-1/A up. This level seems a logical target as it was resistance for most of 2009-2011 and acted as support in 1998, 2001, and 2003-2006.

TNX

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TYX: Same story here as TNX. Multi-decade breakout. Can it be a fake out? Of course it can, but IMHO not as likely as we’re dealing with a decline in place since the 1980s and a move above a downtrend line in place since 1987. That must be respected. For now there’s too little data available to make concrete upside projections, though a revisit of $40 is certainly in the cards first. If an impulse up develops (too little data available ye to know), then we could be looking at $47ish for a completed 5-waves up. The $45-$50 zone has been S/R for most of the 2003-2011 time frame, and thus $47 seems a logical target for wave-1/A up.

TYX