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TBT and 10-Year Treasury YIELD Remain Under Pressure


What now for the ProShares UltraShort 20+ Year Treasury (TBT)?

Well, with 10-year YIELD trading at 2.19%, a new low for the decline off of the March 14 pre-FOMC rate hike high at 2.63%, by definition, TBT also is under pressure, also making new corrective lows at 36.78 so far.

Let's notice on the TBT chart, that if we view all of the action off of the March 13 high at 42.28 as a corrective down-channel, and if we view all of the action since March 31 as an "inside" minor down-channel, then a press towards a test of both lower channel boundaries point to targets of 36.60, which if violated and sustained, then will point lower to 36.00-35.80.

Right now, continued sluggish economic data, the absence of a timetable for tax cuts and infrastructure spending, and the persistent heightened geopolitical tensions (flight to safety) argue for TBT (YIELD) weakness into the lower channel target zone of 36.00-35.80 prior to my expectation of a major upside technical reversal.

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