Trade of the Day – iShares 20+ Year Treasury Bond ETF (NASDAQ: TLT) October 25, 2023 238

Trade of the Day

iShares 20+ Year Treasury Bond ETF (NASDAQ: TLT)

(Current Price: US$85.35) – TECHNICAL BUY

Buy price: US$85.35     Stop loss: US$81.20 (-4.86%)  

Take profit 1: US$92.20 (+8.03%)     Take profit 2: US$97.00 (+13.65%)    

 

(1) & (2): TLT formed a bullish reversal morning star candlestick pattern recently in descending wedge

(3): This was accompanied with bullish divergence on both Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) technical indicators showing bearish momentum weakening as it made a higher low while the price made a lower low

 

(4): The MACD also made a fresh bullish crossover on 24th October

 

(5): Another potential reversal signal was the increased volume build-up which represents increased turnover with fresh buyers interested to go long at low prices

 

Should the price do a reversal from the current downtrend and break out of the descending wedge thereafter, it could potentially retest the first resistance level at US$92.20, confluent with prior swing low supports in October last year and August earlier this year.

 

It could then head towards the next resistance level at US$97.00 which was the horizontal swing highs the price found resistance in August this year.

Expected timeline of the trade is 2-16 weeks from the date of report issuance.

 

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About the author

Profile photo of Zane Aw

Zane Aw
Technical Analyst
PSR

I analyze the stock market and conduct technical analysis to provide investment recommendations. I look forward to having a conversation with you in our in-house seminars and presentations to identify good risk-reward trading strategies together. I graduated from Nanyang Technological University with a Bachelor of Accountancy (Honours).

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