TBT Ultrashort 20+ Year Treasury Daily Chart Sideways Channel

The TBT ETF moves in the same direction as the TNX (10-year yield) and TYX (30-year yield). Bond prices move opposite to bond yields. So TBT is an ultrashort of bond price, hence, an up in yields, that is why TBT moves with yield. After the FOMC Minutes yesterday, traders were tripping over themselves buying TBT convinced that the great bond unwind is beginning.  TBT jumps 3% yesterday.  The chart shows the same characteristics as the TNX (type TNX into the search box to bring that chart up) although interestingly, the TBT has not taken out the September high like the TNX and TYX yield has over the last day.

The indicators show the histogram, stochastics, now overbot, and money flow negatively diverged wanting to see a pull back.  The RSI and MACD line, however, are long and strong wanting to see another higher high.  Thus, a pull back would be anticipated but the gap at 67 should be filled and likely a move into the 67-69 range before all the indicators line up with negative divergence to send it lower again. The RSI may want to travel up into the overbot territory, ditto money flow, before a spank down kicks in. The 200-day MA continues lower which is bearish but the 20 MA crosses above the 50 MA which is bullish. Note that a golden cross would occur around 65-ish if the TBT, and Treasury yields, decide to explode higher over the coming days and weeks.

The volume is strong yesterday as money flooded into TBT but did not exceed the selling volume at 63-65 in October. The Jobs Report in one-half hour will dictate the move in yields, and TBT. Projection is for some price buoyancy in the coming days but TBT should leak lower once the negative divergence is in place over all the indicators. If yields pop large this morning, and folks run into TBT, and it spikes to the 69 level, many of them may be disappointed in a couple or three weeks. The 69 is key resistance. The bullish case will take over above 69, since that would mean the 10-year yield is likely moving towards 2% and the move from bonds is real. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

Note Added 1/4/13 at 8:42 AM:  Jobs report is in-line with estimates, the markets stay on the positive side of flat. TBT is printing 67.51 pre-market which fills the gap shown in the chart.