10-Yr U.S. Treasury Notes (TY) Futures Technical Analysis – October 6, 2014 Forecast

December 10-Year U.S. Treasury Notes sold-off on Friday after confirming the previous day’s potentially bearish closing price reversal top.

The short-term range is 123’16 to 125’23. The retracement zone formed by this range at 124’19.5 to 124’11 is the next major downside target. The first target, however, is an uptrending angle at 124’28.

If the lower or Fibonacci level at 124’11 fails as support then look for a drive into the next angle at 124’06.

On the upside, the first resistance is a downtrending angle at 125’09, followed by the closing price reversal top at 125’23. Taking out this price will negate the chart pattern and likely lead to a test of 125’26.5.

Friday’s better-than-expected U.S. Non-Farm Payrolls report should have been enough to drive this market lower into the close. However, Friday’s late session comeback suggests there may be some work to do on the upside. This may mean a test of the angle at 125’09. Trader reaction to this price should set the tone for the session.

Watch for an acceleration to the downside through 124’28 and a possible quick break into at least 124’19.5.