TLT’s powerful upthrust last week exceeded an ‘external’ peak on the hourly chart by just a hair, but that was sufficient to generate the most encouraging impulse leg that we’ve seen on the hourly chart in months. The bullish effect is compounded by the fact that the low of the last down-cycle did not quite reach the secondary pivot (p2) at 117.80. We’ll want to see the rally blow past a couple more tops on the hourly chart before we get excited, but judging from the steep pitch of Friday’s rally, buyers still have enough energy to accomplish this. The higher of the two peaks, where you can set an alert, lies at 123.47. _______ UPDATE (September 21, 6:10 p.m. EDT): Two steps forward, one step back — at least so far. The fragile, bullish pattern noted above is still intact, although Monday’s mini-crash was hardly reassuring on the question of whether it will survive. _______ UPDATE (September 22, 6:50 p.m.): Tuesday’s sharp rally augurs more upside to at least 123.25, provided TLT can get past the p2 pivot at 122.38 that so far has stymied bulls. A move easily surpassing the higher number would be a bullish sign going forward. ______ UPDATE (September 24, 7:43 p.m.): By exceeding 123.25 by a whopping 43 cents yesterday, bulls hinted that there is still considerable buying power remaining to be spent on the rally cycle begun last Wednesday. _______ UPDATE (September 27, 12:35 a.m.): This vehicle continues to behave too viciously to position-trade comfortably. However, despite Friday’s gap-down give-back, the thing to notice is that it occurred after TLT had exceeded several prior peaks on the hourly chart (see inset), refreshing the bullish energy of the hourly chart. That means the selloff so far is merely corrective and that it would not become even mildly impulsive unless 120.99 is exceeded to the downside over the next day or two. _______ UPDATE (September 28, 11:06 p.m.): Monday’s rally was, and still is, a mechanical buy at p=123.23, stop 122.91, for a ride to 124.21, or possibly 125.18, over the near term. _______ UPDATE (1:18): Yesterday’s forecast missed the low and high of the day by a total of 8 cents. TLT dipped to 124.23 before embarking on a rally to 124.29, making the camouflage trade I’d recommended above not only do-able, but close to perfection. Since no one even mentioned this in the chat room, I’ll assume that interest in this vehicle is either nil or merely academic. If I am wrong about this, please let me know in the chat room.
