UK Bond Steps and ForcesThis is my perspective on the forces that might apply on the UK 10Y Gilt. It can climb along the red rectangles to fall down to the big green or if the first red rejects it or the bottom arc attracts it, we might see support in that area. The vertical green is a special one where unusual or special circumstances and price action might occur, either higher volatility or sudden shift in sentiment.
Treat everything as potential support and resistance but also stepping stones in case the market follows the main scenario highlighted with the purple path arrow. The second one with checkmarks is secondary and depends on the activity at the first vertical long red in case we reach it.
Arcs are special forces of attraction and or repulsion. They can be broken depending on the momentum or type of activity. If the price slows down near them it can just slide through them, but if candlestick patterns of potential reversals and inflections are formed, I will take a good look at them when deciding how and if to approach the market or adjust/manage previously opened positions.
