10y Treasury collapsed right to major supp/res. Careful here!
Bonds are very oversold now, and price reached an important key resistance. I expect some consolidation here, even a pull back would be very healthy. So if you were lucky enough to be short, time to reduce positions.
DO NOT go long! Rather try to catch a spike to open shorts again.
- Straight collapse from 130-131 to 126'23. -> major is here. Probably that's why Mr Gundlach also suggested 10y bond yield could temporarely top here.
- Heikin-Ashi signal is strong , but watch out for haDelta and DMO which reached extreme lows! -> Market is very oversold, this momentum can not be as high as now. Consolidation should happen.
- EWO is more , suggests a new longer term is unfolding. -> try to find value entry points for shorts
- is lower, signal line dips below zero!
- and Heikin-Ashi setup
- Warning for shorts: haDelta, DMO and EWO all too deep low. They should correct from extreme low prints.
- If market pulls back towards 129-129'15, try to catch a sell signal there!
Long term I think rump's fiscal policy will matter: he will do a big fiscal stimulus to achieve his goals. Only way is USD devaluation: issue more bonds and monetize it all. That will be very bearish for the USD.
There is also one more thing to watch: if ECB changes policy a bit, and they go after FED, let's say with some tapering, or rate normalization. That would also reverse the EURUSD.