Bonds continue to flourish

Bonds 

Bonds continue to flourish with the 30-year, which is currently sitting at multi-month highs and both intermediate term and near term momentum favoring a bullish outlook. After making relatively new highs on Monday, prices pulled back a bit only to resurface back above 136’00.

Look for positive momentum to produce a retest of the 136’16 high and perhaps continue above this level as strength in bonds looks to persist. Yesterday’s lows could provide a valid level of initial support, followed by the 135’09 pivot on the chart. The positive directional bias will likely remain in effect above the 4/22 low around 133’14, so buying corrective pullbacks into support is still a valid strategy in this particular market. Until price begins to break the underlying positive nature of the price action, traders should continue to look for high probability setups on the long side of bonds.

30-Yr. U.S. T-Bonds 30-minute Bar Chart (e-Signal)
 

Silver (COMEX:SIM14)

Despite recent weakness thus far in 2014, Silver has been off to a roaring starting in the month of May.

After bottoming on May 1st around 18.685, price has been on an upward surge, rallying nearly a dollar off its lows. The biggest challenge in the way of further upside in Silver appears to come in the form of resistance around the 19.750 - 19.770 area on the chart. This level of support also happens to coincide with the 61.8% retracement of a previous sub-range in price, dating back to the 4/10 high. If price can sustain a move above this resistance area, then there is a very real possibility that Silver could make a move back above 20.000. Furthermore, there does appear to be some good technical support around the 19.500 – 19.560 area on the chart, which should keep prices from falling back on its heels.

Silver 30-minute Bar Chart (e-Signal)


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