Are Bonds Finally Topping Out?

08/30/2010 1:24 pm EST


Thomas Aspray

, Professional Trader & Analyst

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The September T-bonds made a new high in price last week (low in yield) and reached the upper trading channel before reversing to close near the lows for the week. This “gravestone doji” candle formation is often seen at major tops as the market moves high enough to entice the last buyers before trapping them in at that high price. Bonds are up sharply today (Monday) and it would take a close below 132 ½ to complete a top. The decline in many bond funds last week also came on higher volume, suggesting heavier selling.

Tom Aspray, professional trader and analyst, serves as video content editor for The views expressed here are his own.

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