My My MYI – Are Bond Prices About to Rise?

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This chart has got it all. Just when you think the bond market is dead, this chart shows up. What are we looking at? This fund invests in Municipal Bonds for yield. The chart has been a great precursor for a lot of the bond action. We’ll step through what I see in the chart.

First of all, lets review the basic rhythm of the chart. After a hard drop in late 2010, the fund rose from early January 2011 to Dec 2012, a two year run. In January 2013 it failed to make a new high and by March it had dropped below the 40 week moving average. After retesting the 40 WMA from below, it cascaded down. Now it appears to have made a double bottom with the big increase this week. It reversed above the 20 WMA again after making a previous attempt in September 2013. So what does this mean? Well, it tells me there is a probability of a $UST reversal to higher prices and lower yields.

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My My MYI – Are Bond Prices About to Rise?

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