Yellen's Speech Sends Bonds Into Tailspin
Benedetto DiCostanzo | Sep 27, 2015 03:33AM ET
When Rate hike expectations were squashed by the Fed’s decision to keep rates the same, Bonds rallied up to resistance on Thursday, September 24th, reaching 157 16/32. This is the 50% retracement level of the move from the August 24th high of 163 1/32 to the September 16th low of 151 25/32. Price couldn’t hold that level as Janet Yellen’s somewhat hawkish speech last night sent Bonds into a tailspin today. I think Bonds will continue to be pressured and see it breaking down to test support at 151 6/32. I would like to sell futures at 155 23/32 with a stop above 156 10/32. Bonds may have completed the 4th wave of a potential Wolfe Wave pattern, which could lead to a breakdown stab below the 1 to 3 trendline, which could lead to the formation of the 5th wave. There will be more to follow if the pattern continues.
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