The Birth of a Bull Market?

The 09/06/24 blog “U.S. Treasury Yield Update – 09/06/24” had these comments.

“The other factor that could contribute to TYX trending lower is the U.S. FOMC interest rate decision on 09/18/24.  It’s widely expected that they will cut short-term interest rates by at least .25 basis points, perhaps more.  This could be a classic case of “buy the rumor sell the news”.

There’s an inverse relationship between yield/rates and bond prices.   As bonds rise, yield/rates fall.   In this case as TYX declines the U.S. 30 – year Treasury bond prices rise. 

It’s possible that U.S. 30 – year Treasury bonds could rally into an important top on or just before 09/18/24.”

On 09/17/24 U.S. 30 – year Treasury Bonds topped and the CBOE – 30-year treasury bond yield (TYX) bottomed.

The daily TYX chart courtesy of Trading View shows what happened after 09/17/24.

The move up from the 09/17/24 bottom has taken the form of an Elliott five – wave Impulse pattern which could be the first wave up of a larger developing bull market.

TYX has reached important resistance.  The high on  10/23/24 was right at a Fibonacci .50 retracement of the October 2023 to September 2024 decline.   Prices are also near a Fibonacci .618 retracement of the April to September 2024  decline.  Additionally, there’s chart resistance at the 07/24/24 short-term peak.

On the 10/23/24 high daily RSI had a bearish divergence indicating short-term momentum could be diminishing.

Two or more close Fibonacci points implies powerful resistance.  If TYX moves above the 07/24/24 top it could open the door for a rally to the 04/25/24 top at 4.846.