In early September I asked if TLT was topping? A possible Island Reversal might be forming (see the link below):
http://theelliottwavesufer.blogspot.com/2011/09/tlt-topping.html
The possible Island Reversal was never confirmed and Fed's shifting for short maturity bonds to longer term maturity bonds pushed TLT back up and slightly above the December 2008 high at 123.15. However we might have seen the top now. As can be seen on the upper chart the rally in 2008 and the current rally might be fractals of each other, if that is the case we can expect a very sever decline very soon.
The first real warning, that this possible decline could be under way is, if the red channel support-line 117 breaks, which will only leave a very slight possibility that support at 115.76 will protect the downside.
As can be seen on the lower chart we have a clear divergence between the September 22 top and the October 4 top, which also reinforces the risk of a top being in place.
No comments:
Post a Comment