20 year US treasury bonds
Here is my 2 cents regarding long term 20 year US treasury bonds. I am using the proxy TLT etf (probably a mix of maturities 20+ years)
Here is what’s curious we have experienced years of near zero interest rates and the FED has signaled higher rates going forward.
I am no expert on bonds but when I got my brokers license many moons ago we were taught higher interest rates decrease the value of existing bonds because as new bonds yield more, the existing bonds value in the marketplace decreases. Hence higher interest rates lower bond market.
We have had a very long bull market market in bonds since the 1980’s with rates near zero one wonders how long this can be sustained.
Looking at the chart of TLT there has already been a sizable decline since Feb 2016 (I imagine in anticipation of higher rates)
However it looks like a new leg higher in bonds could unfold. We appear to be commencing a wave 3 up in a new 5 wave impulse wave UP.
The time to short 20 year US treasury bonds has come and gone. I would be very wary to go short here.
My own indicators are not signaling to go long here either yet.
thanks gold tooth.i posted a comment by mistake in the post above by karl.in case you want to see
I can’t replicate your 18mo chart for TLT daily at all.
My TLT chart doesn’t show the Feb 2016 gap you have from 128 to 142.
Nor that then being the high.
I have Feb up to 135, then sideways and higher to 144 but not til July.
I agree that TLT is neither a short nor a long here.
But I think the next tradeable move will again be a short (via TBT) running through spring.
Another leg of the correction up off the lows seems likely BEFORE that trade.
The Feb 2016 gap up looks like a glitch to me to but to chart from the Feb 2016 top onward looks OK to me compared to stockcharts. I don’t think the data glitch would invalidate the 5 wave up (labeled with a 1 circled) followed by a ABC correction and now wave 1 up 2 down and starting wave 3 up.
If you see my other chart on TBT ultra short bond
https://goldtadise.com/?p=394197
You will see it is also indicating more downside to come which corresponds with the TLT long bond chart above indicating a possible rally.
I would be inclined to short SELL TBT ultra short bond which would be a bullish call on bonds.
some big names are still long bonds.lacy hunt,gary shilling,for example/here is a very good interview for those who would like a macro view
https://www.youtube.com/watch?v=8tpm2IoK3wE