TLT – Weekly Analysis

CANDLES

No surprises from TLT this week. After becoming grossly oversold, the ETF bounced and even managed to form bottoming patterns on the daily and 2D frames. However, it fell just short of forming a weekly Piercing Line and instead ended with a Thrusting Line, which is generally treated as bearish continuation.

Nevertheless, if TLT continues to push higher into month-end, the monthly frame could still form a Ladder Bottom. If confirmed, that would be a meaningful long-term bullish development.

From the larger perspective, we should remember that the 2M and 4M frames printed bearish signals in April. This suggests that any move higher is still likely to remain limited unless the larger structure improves.

Overall, TLT is bullish in the short term, with potential to extend momentum onto the weekly and monthly frames if the pressure holds through the end of May. This makes next week critically important and potentially a turning point.

Elliott Wave

Short Term – Flag

TLT made a new long-term low below the 2025 low, landing squarely in the target area we outlined in December. The larger blue ABC structure remains on the table, but its probability has now been reduced.

With a new lower low recorded, the path lower has technically opened. At the same time, TLT still has a chance to start an impulsive move up from this area. The wave off the bottom is still very young, however, and we need more time to see its true character.

For now, the focus shifts to the upcoming monthly signals, which should provide better directional guidance and help clarify whether the current bounce is the start of something larger or only another reaction within the broader bearish trend.

Technical Event (Historical)

As TLT recorded an extremely rare and impactful technical event on the monthly frame, I will keep the following piece discussed in the November 2024 monthly report for a reference:

The monthly frame, despite closing with a green candle, is currently viewed as a bearish continuation candle. This interpretation is supported by several technical indicators, most notably the freshly recorded 50/200 monthly bearish cross—a massive and concerning development.

Since I could not find a very long-term dataset for US20Y or US20, I extrapolated the event using the inverted US10Y dataset, which closely mirrors US20Y and has data extending back to 1913. As shown in the chart below, a similar sequence of 50/100, 50/200, and 100/200 MMA bearish crosses occurred in the early 1950s. That sequence is now repeating. Most likely, the 100/200 MMA cross will be recorded in early December (it was).

Adding to the concern, the first wave off the top (on the inverted scale) was strongly impulsive. The key question now revolves around the length and duration of wave 2/B before the next major move down. Will it stretch over another year or two, or has a sharp zigzag already completed? The upcoming annual closure will likely provide significant answers.

SUMMARY

TLT remains at a critical inflection point. The ETF reached the long-term downside target area we outlined 6 months ago and briefly bounced from oversold conditions, but the new low below the 2025 level keeps the broader bearish path open.

There is still a chance that TLT begins a larger impulsive recovery from this area, potentially keeping the blue ABC structure alive, though with reduced probability. The next key evidence should come from the month-end signals and the character of the current bounce. For now, TLT is short-term constructive, but the larger trend remains vulnerable until stronger confirmation appears.