Loading ...Re: interest rates and bond market cycles. Electrum’s post
This is my 2 cents on Electrum’s post regarding the US Bond market suggesting “when the time comes,it will be a “big short” Electrum I ran a chart of TBT (Ultra short 20 yr bond) from 2008 to now. Unfortunatly we are a little late. It appears it WAS a great short starting in 2008. It has made 4 major waves down already (circled), starting from a high of $325 to currently $40 ish.
It looks like the meat of the trade is already complete. That said we are still in the 5th wave down. In fact the daily chart indicates it would be a good short term short but I would hesitate to take a long term bearish view.
“when the time comes, it will be a “big short” Electrum
“I ran a chart of TBT (Ultra short 20 yr bond) from 2008 to now. Unfortunatly we are a little late”
Won’t speak for Electrum. But most are now looking for the end of the 35 yr bond run from 1980. Using TBT as a LONG.
Some called last summer the final bond peak. Others are noting we reversed at the LT downtrend line (for yields not prices), where we should have.
That need not assure us of new ATHs however.
Lacy Hunt claims we WILL see new ATHs for prices. And he’s been the most right of anyone, for a long time.
If so, we are certainly not late but would be early. For TBT longs, not shorts. ie, Bond shorts.
Suggestion — keep the discussion clear on prices vs yields, and longs vs shorts on the underlyings vs their derivatives (esp inverses).
Otherwise, bond discussions get very confused.
My bad here, I am a bit dyslectic ha ha This this is the TBT ULTRA SHORT 20 yr bond… duh.
Of course shorting the TBT ULTRA SHORT 20 yr bond would have worked out boffo!
It gets a bit confusing when you are shorting a short ETF. (I am starting to get confused again now)
As for using TBT as a long by that you must mean shorting it. If that is so, like I say the best part of that trade has transpired. IMHO
I hate Bonds BECAYSE they are so confusing…always gotta think backwards..Bond Prices UP Interest Rates Down…sheesh
gold tooth thank you for your post.i think there is some confusion.
being long bonds has been the position to be in using the tlt etf.shorting bonds has been a disaster as evidenced by your tbt chart.there for the question that was raised is
if the bull market in bonds is coming to an end,and we might now be at the start of the big short.as is always the case the debate rages on.some say that bonds will resume their uptrend until yields will drop(on the 10 years bond) to 1%.others has been calling for higher rates and falling bond prices for years as is the case in the article in my post
Electrum I am assuming you think the big short is shorting the 20 year bond. If so I think that now is not the time. TLT has already experienced a big decline and I think it is on the verge of a new upleg I will post the chart with my thinking on TLT if you like.
I like
omg,pulling out my own teeth upside down with a mirror is easier than this.