TBT – This is almost a picture perfect pattern that demonstrates the power of support and resistance. Given that it was rejected on the price chart at resistance and the RSI indicator at 60, and the moving averages are all pointing down, this almost looks like a certainty to retest the $30 level. At that point we’d have to wait and see if any divergences form or if it crashes right through. If that happens one has to watch to see if a retest happens to determine if it’s heading much lower.
TLT – Reverse everything I said above and add in the fact we’re breaking out of a reverse head and shoulder pattern, this looks solid from a bull perspective. If you drill down a little more, volume is rising on up days starting with the right shoulder and lower on down days. Exactly what you want to see from this sort of pattern.
