Bearish Candles Indicate Higher Yields

09/07/2010 9:46 am EST

Focus: FOREX

Thomas Aspray

, Professional Trader & Analyst

Click to Enlarge

The strong rally in stocks last week put some pressure on interest rates as they moved a bit higher. Over a week ago, I noted the potential top in the T-bond futures, and last week’s action in the T-notes supports this view. The long tails on the weekly candle chart (see circle) suggest selling at the highs and the weekly MACD histogram has formed a negative divergence. It is still above zero but is declining. The key 38.2% support is in the 121 ½ area. Short term T-notes are oversold with resistance at 125 ¼.

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

  By clicking submit, you agree to our privacy policy & terms of service.

Related Articles on FOREX