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(U3) Bearish Engulfing Candle

  • RES 4: 115-19 High May 18
  • RES 3: 115-07+ 1.0% 10-dma Envelope
  • RES 2: 115-04 50-day EMA
  • RES 1: 114-03+ / 115-00 Intraday high / High Jun 1
  • PRICE: 113-27 @ 15:59 BST Jun 5
  • SUP 1: 113-10 Low Jun 05
  • SUP 2: 112-29+ Low May 26 / 30 and key support
  • SUP 3: 112-16 76.4% retracement of the Mar 2 - May 4 rally
  • SUP 4: 111-20+ Low Mar 10

Treasury futures faltered Friday and have extended the pullback from 115-00, the Jun 1 high. A rally into the close failed to materially alter the picture. This keeps focus on the bearish engulfing candle posted Friday, signaling the end of the recent recovery and suggesting potential for a continuation lower. Attention is on key short-term support and the bear trigger at 112-29+, the May 26 / 30 low. A break of this level would resume the downtrend since May 4. Key resistance is at 115-00, where a break is required to reinstate a bullish theme.

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