— BostonCharts (@bostonchaahhts) January 14, 2020
Today’s Chart of the Day was shared on Twitter by BostonCharts (@bostonchaahhts). It’s a daily candlestick chart of the US 10-year Treasury yield ETF, $TNX. Price has been consolidating into an ascending triangle pattern over the past five months, as illustrated by the horizontal resistance line and the rising support trendline. As price works its way toward to apex of this triangle, the range gets tighter and tighter, and the likelihood of a strong breakout in either direction increases. The direction in which price resolves will give us a better understanding of the overall trend in Treasury yields. BostonCharts suggests that the path of least resistance is lower because $TNX is currently in a clear downtrend. It would be wise to keep an eye on this chart because the direction in which yields are trending will have a significant impact on other asset classes, and the breakout could occur within the next couple of weeks.