Bonds! Will! Not! Die! Do You Care?
- Posted by Greg Harmon
- on April 9th, 2013
I can count at least 10 tops in the Treasury Bond ETF, $TLT, since last July. In fact I have numbered the in the chart below. But in the end, every one of the first 9 have been bought. Now we sit with a higher high, after 4 consecutive lower highs. WTF? I thought Bonds were dead. Well maybe this 10th time is the charm. Monday did confirm a Shooting Star reversal lower, and there is a big gap to fill down to the 120.50
area. But the yellow lines outline a Shark pattern that is playing out with a Potential Reversal Zone between 128 and 131.20. That is a long way up from here. Does that mean that this rally in equities has to end? How can Bonds go higher and Equities go higher? Isn’t that money leaving Bonds fueling the rise in equities? Has that ever happened before? Uh, yes. How about for the last 4 years. The chart below shows that the trend for both Bonds and Equities is and has been higher. Now if you are a day trader don’t even
bother to send me an inflammatory response, you should not give a crap about correlations. Swing traders, yes I see that there have been times when one took control and the other pulled back and that could happen again. But our jobs as traders should be to first identify the trend and then work with that knowledge. The trend is up, for both Treasuries and Equities.
Join the Dragonfly Capital Views Premium Membership
Its Time For a Sale at Dragonfly Capital!
And what better time than during March Madness. The Annual subscription rate for the Premium Dragonfly Capital Views Service, will be cut by 20% to $600. That is nearly 45% off of the monthly rate for a year! Follow this link to start your subscription, with free 7 day trial, today.
Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through March 2013 Expiry
If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.blog comments powered by Disqus
Gregory W. Harmon CMT, CFA, has traded since 1986 and held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
- 5 Trade Ideas for Tuesday: Abbott Labs, Applied Materials, Citrix, Graco and Lowe’s
- Top Trade Ideas for the Week of January 17, 2017: The Rest Premium
- Top Trade Ideas for the Week of January 17, 2017: The Best
- SPY Trends and Influencers January 14, 2017
- Macro Week in Review/Preview January 13, 2017
- How This Week’s Top 10 Performed, January 13, 2017
- Premium Earnings 1-13-17: Morgan Stanley
- Confirming the Double Bottom in Emerging Markets
- Premium Earnings 1-12-17: Blackrock and JP Morgan
- Nasdaq Soars as Dow and S&P Bore
Dragonfly Capital Updates