TLT
SPY/TLT Equities vs. Fixed Income aka. Fixed ExpenseProbably the most basic rotation investment strategy, is the switching strategy between the S&P 500 US stock market (SPY) and long duration Treasuries (TLT). The SPY-TLT ETF pair is a very interesting investment strategy, because most of the time these two ETFs profit from an inverse correlation. If there is a real stock market correction, then Treasuries like TLT have always been the assets where money flows in, rewarding holders with nice profits.
M timeframe BULL
W timeframe BULL
50MMA acts as support BULL
200WMA acts as support BULL
MACD into negative territory probability to get positive BULL
RSI M 40 value acts as support in uptrend BULL
SPY/TLT correction 50% fib retracement BULL
RRR favorable BULL
RISK OFF last FEW months
RISK ON next FEW months
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TLT needs to touch top trend before reversingStocks are inverse to bonds. Take the measily little rate your being offered for safety? TLT needs to touch the top trend line once again before reversing. Worst scenario, it breaks through the top trend line, and we have a market crash with a sound you can hear on Mars. That actually could happen because we are in currency fantasy land. Paying someone to hold my money, store it? Crazy, stupid, makes no sense. I should go to cash, oh wait, go to dollars to be more specific. And when that happens, TLT goes through the top trend line, and panic stock sell happens. Just take a step back and have a long hard look at this big picture.
SPY: SPDR S&P 500 M timeframe BULL
W timeframe BULL
D timeframe NEUTRAL
GOLD/SPY turning negative BULL
SPY/TLT stocks vs. bonds turning positive BULL
US10Y overextended BUY
TRADE WAR hopes BULL
MARKET overreacted BULL
DATA above consensus BULL
% SP500 stocks above 200SMA > 50 support BULL
RSI > 50 momentum BULL
RSI support 40 hold BULL
VOLUME buy momentum BUY
MACD bears loosing momentum BULL
TRENDLINE false breakdown no LC W candle BULL
RECESSION IN THE NEXT 2 YEARS POSSIBLE
EXANTE is a broker for professionals. Direct access to over 50 financial markets through one account.
Stocks & ETFs, Currencies, Metals, Futures , Options, Funds, Bonds, Crypto¬currencies.
Any information contained on this website is provided to you for informational purposes only and should not be regarded as an offer or solicitation of an offer to buy or sell any investments or related services that may be referenced here. Investing in certain instruments, including stocks, options, futures , foreign currencies, and bonds involve a high level of risk.
Eye spy with my lil eye something that is "FED" this is weekly TA prediction leading up to the FED rate hike/cut decision around the 18th new ATH or fight CHOPPY CHOppy
2019: Long-Term Bonds > Stocks... Why?TLT has outperformed SPX by roughly 6% at time of writing. Many factors: FED cushioning rates, yield chasing by entities in negative-yield countries, fears of global slowdown, escalating trade war, and the perceived invincibility of U.S. markets.
There could be a seriously nasty rate spike within the next 2 years. As yields drop there is less incentive for entities to invest in bonds... if yields drop below the purported rate of inflation, which they already have (1.48% US10Y vs 1.6% PCE), there is no longer an incentive to hold them, as they produce negative returns. The deeper yields fall below inflation, or the higher inflation rises above yields, the stronger the momentum of a selloff. Will it happen? Free market forces would say yes, but considering the FED can print anything into a rainbow, the span and severity of such a spike is indeterminate... chances are that it will be uncontrollable for enough time to do some damage before the right players come to consensus on how to backstop it.
Long term we all know where this leads - negative rates for everyone, yay! A serious spike in yields should be seen as a patient opportunity. When the time is right, trade /TN, TLT options or whatever bond instrument you prefer.
US10YAn inverted yield curve (2/10) is an indicator but the 'cause'. Yields were 6%/5%/4% last times they were inverted and not 1.5% :) If corps can't afford to pay 1.5%, there is nothing Fed can do to resolve that issue. Policy issues are the cause and the cure is fiscal and not monetary. GL
Not a trading call, just sharing my view. Peace
Do you Feel Your Back Side Tightening Up?All right! let me see a show of hands. Who got long TLT when I told you to? Ok, it didn’t make it down to $110, but if you listened to me, you at least aren’t Feeling the Burn like the Head and Shoulders Short Sellers are!
Ok, if you are long the TLT, get ready for it to rocket up into the $130’s and really start inverting that Loan Curve!
TLT - 9.43 R:R ShortEvening traders, been a while since I shared my thoughts.
I'm looking to enter short on TLT, as it's approaching historic over-extension.
Let's dive in at the key points:
1) It's gapped up and will likely close outside the BB, should lead to down movement next week.
2) Short term squeeze has begun to trigger, this week is likely the top.
3) RSI is overbought and approaching historic levels.
4) Stoch is overbought
5) Percentage volume oscillator shows trend strength is reducing.
6) We have bearish divergence on money flow.
A re-trace towards mid bb band / .5 is likely in order, if the weekly 5 EMA is supported I will exit the trade as there would be another leg up in store. This should coincide with one more up for the markets.
From a fundamental point, after inversion I believe market continues for 7 months upward, yes, I know, this time is different. Rates are low, fed doesn't have much ammo, corporate debt is outta control, I know, I know. The chart doesn't lie though, I think we will have one more up in the markets before the big collapse, and it just so happens I believe bonds are topping temporarily now as well.
As always, hit that like and follow button and let me know your opinion!
TLT Levels to Keep an Eye OnTLT
I'm neutral on TLT, seems overdone but it's a flight to safety from all over the world. Could go to $145 unless the rhetoric is dialed down.
$TLT is a short here at the top of the channelGet your shorts and/or puts ready for TLT. - Goodluck
Do not trade on behalf of solely my opinions. -Thanks!
TLT
Inflation Proxy StablizingDoubleLine's Jeff Gundlach often refers to the copper/gold ratio as a proxy for U.S. yields. Although this is comprised of two commodities that tend to do well in rising inflation, it can be seen as a growth proxy as well, which in turn filters into where yields are moving.
Market participants often allocate to copper when growth is trending higher and, conversely, gold when growth is muted. We currently have a record net-short positioning on copper which could suggest yields may move higher.
TLT/SPX Ratio vs SPX. Volatility is set to EXPLODETLT/SPX ratio vs SPX (M, No Log). Havent gotten a C13 on the DeMark yet but should be soon. It looks set to explode after the 10 year build up into the very last inch of the bullish wedge. The calm before the storm :(
S&P 500 Next Week Expected Move ($45) and Gravity PointsLeaning slightly bullish due to the weight of the evidence but there are too many binary events coming up in the coming week that could throw off my thesis. Plus we rallied so strongly the last 3 weeks that I wouldn't discount the fact that the market might just consolidate while it waits for the G20 meeting.
Blew through last week's expected move ($41) and had a $63 gain on the week. This next week the options market is pricing in a $45 move higher or $45 lower, nondirectional. Amazingly, for the first time in 18 months I have no Gravity Points lurking above us to target. They have served me very well and I hope they have for you. I will continue to locate Gravity Points going forward as we make them.
Many significant things occurred this week. I'll list those I'm aware of:
(Negative) - Economic data is now definitively weakening - shown by the Empire Manufacturing Data and several others
(Positive) - The Dollar; $DXY, $UUP is on the brink of breaking down
(Neutral) - Most interestingly; $GOLD, $GLD is breaking out of a 5 year base which adds to the bearish case on the USD
(Neutral) - I think Small Caps $IWM might turn the corner and start leading relatively soon here, the ratio between the $IWM and the $DIA is at the low end of its historical range, however my two favorite market leading indicators the IWM and DJT weekly charts failed at the moving averages and is nowhere near all time highs which is bearish.
(Positive) - Market Sentiment is very neutral, which is odd given that we are making new all time highs and a positive omen going forward
(Positive) - Copper is staging a bullish reversal which is a relief for foreign equities
(Positive) - OIL; $USOIL is staging a bullish reversal which is also bullish
(Neutral) - Quadruple Witching occurred this week which means there's a lot of rebalancing going on
(Negative) - The $VVIX and $VIX are both back to considerably low levels
(Neutral) - The correlation between bonds and stocks is very high and unsustainable; typically I trust the debt market over the equity market but not this time
(Positive) - Bonds; $TLT created a significant bearish divergence after rallying for nearly 20% in 6 months
(Positive) - Related to the TLT, the $TNX had a capitulation low at 1.95. Now that the FOMC is out of the way, I think bonds will stop advancing in the near term.
Scorecard:
Bullish - 6
Neutral - 4
Bearish - 2
Last Week's Post:
I'm not sure if this makes any difference for getting this post out there or not but I'm going to try it out anyways. Don't know how the system works.
$SPY SPY $ES1! ES1! $SPX SPX $DIA DIA $QQQ QQQ $NDX NDX $IWM IWM $RUT RUT $IYT IYT $DJT DJT
THE WEEK AHEAD: ORCL, GDXJ, TBT, TLT, SMH, OIHEARNINGS
ORCL (50/29) releases earnings on Wednesday after market close, so look to put on a play in the waning hours of Wednesday's New York session.
Pictured here is a non-standard short strangle, with the short call side doubled up in order to compensate for greater than one dollar wide strikes: 1.30 credit, break evens at 48.70/58.15, and delta/theta of -5.52/58.15.
As of Friday close, the June 21st to July 19th monthly volatility contraction is from 46.6% to 29.3% or about 29.7%.
Look to manage intratrade by rolling the untested side toward current price on approaching worthless with a 50% max take profit target.
Generally, I don't play stuff this small that doesn't have dollar wides, since rolling intratrade can be a headache, as can rolling out, since there is limited strike availability. It's really another aspect of liquidity, which is not only about the width of markets intraexpiry, but also about the availability of expiries out in time, as well as strikes.
BROAD MARKET
EEM (27/20)
QQQ (23/20); NDX (24/20)
IWM (23/19); RUT (25/19)
SPY (21/15); SPX (19/15)
EFA (16/13)
With 33 days to go in the July cycle and 61 to go for August, we're kind of in the "in between" for the 45 days 'til expiry sweet spot, so I would wait until August comes closer into view for either broad market or sector if you want to keep things in that 45 days 'til expiry wheelhouse.
SECTOR EXCHANGE-TRADED FUNDS
Top 5 By Rank: GDXJ (62/31), TBT (52/24), TLT (51/12), SMH (50/31), OIH (49/40).
SINGLE NAME WITH EARNINGS IN THE REAR VIEW
A lot of earnings start kicking off in the July cycle, so would wait to play these as earnings announcement volatility contraction plays instead of wading in here and getting caught in a volatility expansion.
ME PERSONALLY
To keep things simple, mundane, and boring throughout the summer months, I'm looking to just to play broad market for the next couple of cycles -- SPY/SPX, QQQ/NDX, and IWM/RUT. (See, e.g., RUT Sept Iron Condor below).
Copper / Gold ratio update - Treasury yields are roughly correctCopper / gold ratio is in line with 10 year Treasury yields at the moment.
Last year's big gap has corrected. So no actionable signal right now
BASF stock price points to a rate spike in German bundsDE10Y vs BAS.DE : BASF stock price tends to lead German 10 year yields. Currently, BASF signals a rate spike is in the cards followed by another low in DE10Y
Business Cycle update - Still more downside for Steel and RatesBusiness cycle still points to more downside in steel prices and treasury rates. Recent declines are too fast and such fast declines are usually followed by some bounce/consolidation before more downside.
