Post FOMC – What’s next for bonds

All right, folks, now that the FOMC announcement is out of the way for today, we have bonds, settling down about 15 ticks at 161 23. Now I’m looking at the daily chart here, and looking for an indication of the next move or next leg here on the 30 year bond force, you can apply this to TLT, which will track very similary, or TBT, which is the inverse of the 30 year bond or the long bond. So here we’re looking at the 30 year for next potential direction. And if you see here on the daily chart, after we have broke, after we kind of broke this intermediate term trend right here in in August, we basically been trading in a longer term range. So what I’m going to do here is show you this kind of compressed state that we’re in for the 30 year, here is the upward trend line. And then we could see that we are all we’ve also been tracking this trend line right here, we did have a little bit of a false breakout there in the beginning of the month and have come back in to this range. Now, even if we want to get even tighter, we can see that we’ve got a little bit of a triangle here as well. So now we’re looking for the potential break of this either to the upside here at around the 164 level, or to the downside around the 158 level. Now this represents about a five handle or five point range, that’s about $5,000 per contract as each point is $1,000. So if we take a look, from a seasonality perspective, to get some type of bias, we can see that does favor to the upside, starting at the end of the month and carrying over into the end of January, roughly about a 30 day calendar trade. This trade has been profitable at 6% of time over the last seven years using our smart seasonal software. And again, it favors a bullish setup or bullish scenario that starts around the end of the month, and carries into the end of January. So based off seasonality, we would expect to see a move to the upside. Now, if we do start getting breaks down here below 158. In those areas hold, we would be looking for a test down here of these lows, which would take us to about 154, that would take us from about 158 to 154. Achieving about four out of those five expected points to the upside, we would be looking for first target here, if we break out or run around the 164 area would be looking for a target of around 169. And you’ll notice that that takes us to about right here, this old area of structure, which would be a very nice target, you can see that that area has held here and held here. So that would be a nice upwards projection or target if we break to the upside. So all we’ve got to do is sit here and be patient would not trade this thing right now unless you’re on the lower timeframes. But we’re looking for a move or a break rather, you see we’ve got a lot of resistance that that will also nullify here would be above the 200 day be above this trendline. And then we’d be looking for a move up here to these old highs. Alternatively, on the breakdown or the downside be looking for breaks in close and holds below that 158 level before I moved down to about 154