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Point & Go Figure: 10-Year Treasury Yield Index, Micron Technology


Time for a little pre-Summer slither?


Market Overview:

The broad bullish percent indicators for the NYSE and the Nasdaq Composite remain negative for the first time since last October. Meanwhile, the NYSE Percent Above 50-day Moving Average Indicator has reversed up to Xs (positive) for the first time since the selloff began, suggesting a short-term period of oversold resolution is underway. The Nasdaq Percent Above 50-day Moving Average Indicator remains in Os (negative) for now, but could reverse today or Tuesday.

The High-Low Indices for the NYSE and Nasdaq are both in Os and also nearing levels from which significant relief bounces can occur; both were actually higher with Friday's action.

With the overall context now negative, any move higher should be short-lived (days not weeks)and in my opinion provide an opportunity for longer-term sales or hedges. In other words, expect negative surprises, not positive surprises.

Charts of Interest:
10-Year Treasury Yield Index ($TNX)
(Chart courtesy

The chart of the TNX shows higher bottoms going back to June 2003. the period between August 2003 and March of this year now appears to be a large basing formation, supporting the PnF vetical count for a move to 59.

10-Year Treasury Yield Index (TNX)
(Chart courtesy Thomson Financial)

The monthly chart of the TNX shows the long-term basing pattern of the TNX. 54 is an obvious area of contention for the TNX, well ahead of the PnF projection of 59.

Micron Technology (MU)
(Chart courtesy

Minyan JK asked about MU. On a PnF basis, the chart continues to form higher bottom after higher bottom and remains technically sound. MU has not given a PnF sell signal (.25x3 chart) since March 2005. The nearest PnF sell signal on the chart would not occur until15.

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No positions in stocks mentioned.

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