TLT - Fed Action SensitivityRed Lines denote hikes, Blue lines denote cuts.
What will we hear on YCC? Will it induce a bond squeeze?
TLT trade ideas
Bullish Garley PCZ At Support Above The 200 Week Moving AverageTLT has hit a significant support visible on both the weekly and the monthly at a 78.6% Fibonacci Retrace from the previous low to high. I will expect to see TLT attempt a Bullish Reversal from the horizontal support zone i have highlighted in green. If we get any significant movement below the 200 week moving average then i would exit the trade. As for profit taking levels, i would take some profit once we near the last high and hold the rest as i believe we could go much higher.
BEST INDICATOR FOR TLT: When to build positionsWe have here a chart of a TLT with a comparison line of the ZN1!/ZB1!. What I have found is that when the ZN1!/ZB1! ratio hits a resistance level, TLT is also nearing it's bottom. I encourage you to look at the ZN1!/ZB1! separately. Recently, TLT has reversed with strength to the upside once these resistance levels are in range.
$TLT Craters on Big Economic ExpectationsTLT starts to crater as economic expectations pick up steam ahead of vaccine-induced herd immunity. Fund managers hit record bullish levels according to key surveys, juicing inflation expectations.
TLT breaks supportI've been watching this zone for a while as very significant support. Could see an outsized move down. I'm unsure about the impact on stocks at this point. Many would say it is great news as it confirms money moving into stocks. I personally feel its a good sign as long as the move down is slow and controlled as we do not want to see a rapid rise in bond yields. See previous post.
Bond Meltup IncomingInterest rates are going to continue to move up to help drain the excess liquidity in the system. TGA will spend the last of its money in the form of a stimulus package, then we will see a great reversal on the dollar and interest rates, as cashflow continues to dry up, banks too scared to loan to each other (and therefore not make consumer and commercial loans), and money continues to move from consumerism to savings accounts. Put simply, illiquidity in the system, and raising interest rates will lead to a smackdown to near-zero again, maybe even negative, to prevent a major shock to the system.
Looking to buy more TLT dips this year. I think the meltup will begin with bank insolvency.
TLT LongIn downtrend Channel,
Demand Zone below Sideway consolidation
Entry 149
Stop 145
Target 162
I am not a PRO trader. I trade option to test my trading plan with small cost.
The max Risk of each plan is less than 1% of my account.
If you like this idea, pleas
BONDS broke two key support areas, 148 our last hopeBond price has dropped below two key buy trend lines, if it breaks 148, interest rates will continue to rise, which I predicted was a false breakout above 1.0%. However, Dow also showing resistance at 31,500. Bonds and stocks are NOT inverse.
The bond yield issue returnsAnybody notice this, or are all eyes laser focused on GME and covid?
This is fire alarm 100; but it is a major rupture. Ignore at your own peril.
Equities are about to sell off massively imoThe biggest sell off in history might be upon us in stocks. Stay out of the market if you want to be safe imo. This chart is telling us a very important story....
The Mother Of All Bets (MOAB)With the financial world turned upside down people are looking for vulnerabilities within the system. Let me direct your eyes to the long end of the bond curve. Stress is already apparent in the repo market and funds are beginning to unwinding left and right. If you look at cot data on the long end of the bond curve specifically the 30-year you will notice that shorts have piled in to the highest level they have in all of history. This virtuous cycle was created in the anticipation that the Fed would spark inflation. Spoiler alert they didn't. With the dollar beginning to reverse I feel now is the time to go long the long end and expect for financial conditions to tighten as the demand for cash spikes.
TLT/JNK Breakout Similar to MarchTLT/JNK looking to break out of it's downward trend to become bullish again. As money looks to move towards safe havens. Looking for 172.
TLT/XLF: Banks don't like what they smell.Banks are the best indicator of the financial health of the market.
Analysis:
TLT/XLF is flashing warning signs if banks fail to make new highs. Banks are being incredibly stingy with their money lending and low interest rates are not helping their profitability. Banks are sitting on Mr.Powells printed money. I am not seeing a lot of strength in the banking sector as, they have failed to follow other asset classes. XLF has failed to break its March highs which, is very concerning.
Looking back at history, when TLT rises faster than XLF, it is a bad sign for markets and an indicator of systemic risk. The ratio of TLT/XLF at this level has been a major support zone. Additionally, there was a very strong reversal. TLT is experiencing heavy buying volume and is reversing the down trend from March. The 2008 and 2020 market crashes occurred from these levels. Banks are acting very sheepish as, the smell the wolf (DXY) coming. Dollars are needed to pay off debts....Liquidity crisis?
Opinion:
A ticking time bomb, it's not a matter of if but, when. I am positioning myself away from this bomb an extra 10%-20% gains in equity is not worth a 40% risk, everyone has been so conditioned to buy the dip, it makes me wary to follow the flock. I am still long equities to an extent but, TLT is my biggest position. Please don't let my analysis get in the way from you buying GME,AMC,NOK,BB or FAANG. This is just the smoke alarm going off signaling a fire in the vicinity and I am telling people "Hey look over there". I truly do wish the best for everyone on WSB and the new wave of retail traders with limited understanding of markets hoping to make a quick buck. I just hope they aren't risk more than they are willing to lose.
BOND RALLY STARTED STOCK TO FALL SHARP I have been talking about a TOP since jan 6 event based on my spiral work . I have been short 3744 to 3824 , as WELL HAS IWM AT 215 AND HOPING TO SEE 222 , The SOX INDEX i TARGETED 3200 WE ARE VERY CLOSE AND WOULD NOW BE LOOKING AT PUTS IN ALL THE INDEX . I been net long the US $ AT 89.50 AND HOLDING AS WELL AS TLT 158.5 AND ADDED AT 151.5 THE CRACKS ARE SHOWING LOOK FOR DEEP DOWNSIDE INTO MID FEB TO MARCH EARLY FOR THE TREND
