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June 15, 2009 / Jeb

Treasury ETF Chart Analysis and Possible Breakdown

TBT 6-15

I have been stopped out of my short treasury trade after TBT broke down.

1)

It fell below the rising wedge pattern on above average volume.

2)

I have noticed a non confirmation of price from the RSI.

3)

It appears the RSI is making a head and shoulders pattern.

There are many economic indicators that are coming out this week especially the important one on housing. According to this chart TBT may have a reversal and there may be government intervention to support lower interest rates, including the FED artificially buying more debt to keep interest rates low. I do believe interest rates are moving too high, too fast and may bring attention by the central banks.

This might be good for GDX as if you read my archived blogs that I was expecting GDX to return to 38.50 before making new highs. Another FED intervention means hyperinflation down the road.

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