30-Yr U.S. Treasury Bonds (US) Futures Technical Analysis – October 30, 2014 Forecast

December 30-Year U.S. Treasury Bonds broke sharply lower on Wednesday, following the release of the latest Fed monetary policy statement. Based on this price action, it looks like traders thought the statement was hawkish. The comeback rally toward the end of the day, represented a change in sentiment following the initial reaction.

The main range is 135’13 to 148’00. Its retracement zone is 140-07 to 141’23. T-Bonds are currently trading inside this retracement zone. In addition, the angle that stopped the break is also inside the zone today at 140’23. Since the main trend is up on the daily chart, this area has to be considered major support.

If 140-07 fails as support then look for potential breaks into 139’17 and 139’01.

Overcoming the 50% level at 141’23 will be a sign that buyers are coming in to support the market. Don’t expect a breakout to the upside, however, unless the market overcomes a cluster of angles starting at 142’16.

Fundamentally, in its statement, Fed policymakers implied the central bank was moving toward a tighter monetary policy more quickly than its peers at the Bank of England and the European Central Bank.

The Fed also announced the end to its monthly bond-buying at the end of this month. In addition, it said in its statement that interest rates could rise sooner or later, depending on how the economy performs. The central bank also dropped the word “significant” in describing underutilization of the labor market. This serves as a sign that it has turned more upbeat on the jobs market.