Tag: TLT

Bonds – August 22, 2023

Last post on bonds: https://bartscharts.com/2023/07/30/bonds-july-30-2023/

Well, rates are spiking and bond prices are falling like a stone. Yup … and to think, folks, this is just wave one down. As discussed about a month ago, the target for this ending wave down is now around 110 is and then, still, the zone lower in the 98-103ish …Who knows, if you think about it.

IF my count is correct, THEN this will be a wave 2 in a bear market in bonds that could last years …and, if the recent wave 2 / b wave in the equities market is any barometer I believe this bounce will be BIG because the narrative of “inflation is under control” and the “fed is easing” and blah blah will come out and EVERYONE will think, that’s it and back we go to tinsel town. BONK.

Just counting … that ain’t gonna happen. Might we get some rate cuts in the upcoming bounce? Sure … Might rates naturally drift back down and blah blah blah blah – absolutely. Folks, it might seem that all is GREAT again.

But, it’s just wave 2 folks. Bonds have been going down for almost 3+ years … a 6 month to a year bounce – CERTAINLY in the cards.

So, I’m going to keep my TBT position ON as I’m going to ride all the waves (like UNG, cough cough – what the heck, why ain’t that thing moving …?) but I’ll be a BUYer of TLT for this bounce.

Why not? Nice bullish divergence on the weekly and monthly w/ some good targets. So, guess we’ll see.

NOTE: it’s getting pretty squirrelly out there … I’m pretty confident in these levels on the 30 year continuous chart. VERY in fact – one of them will stop this free fall. If they don’t, and the bonds fall right thru these levels – I’ll be shocked and awed. LOL … no kidding, the Bond market in a free fall is really an “other” on the good/other scale.

TLT – August 12, 2023

IF my count is right … (remember, my Elliott abilities are like my golf game 😉 then we have started another move down in bond prices but I do believe this is the 5th and final wave of just the first wave down … that being said, w/ all of the “noise” and “sentiment” w/in the market about “inflation under contorl” and the “Fed is going to Ease” and “blah blah blah” I believe this is a countertrend opportunity which could bounce PRETTY BIG just based on sentiment, alone.

For now, I have the 82-85 region as the first target to end Wave 1 down … multiple confirming but non-correlated techniques are showing this to be a very important zone.

I am long TBT (inverse of TLT) and plan on keeping that position open but will also go LONG TLT and have both a long TLT and long TBT position open at the same time. I sense that TBT will be held for YEARS as interest rates are not done for the long term, at least in my VERY humbled opinion.

I like this zone because, a lot of times when the wave 3 is extended you will find wave 5 = wave 1. (FWIW wave 3 was exactly 3 times as long as wave 1 down)

Interest Rates – July 06, 2023

I posted the chart below a little while back … it’s a chart of the ten year interest rates and what I’m trying to show is that, yes, banks and a lot of people got caught w/ the rising interest rates.

Folks, it took 40 years to rise the 700 ish % .. we’ve done it in 3 and we are not done. I’m counting this as wave 5 of 1 or A. So, in the short-medium term expect interest rates to continue rising. Then of course we will get wave 2 or B and everyone will think the Fed is done tightening and that’s when the real smash will occur – a C wave or wave 3 higher? What if this is a new “bull market” in rates…? Wave 3 can’t be the smallest SO … interest rates are rising folks. Ugh.

Long Bond Futures – May 15, 2023

If your a technician, you can’t help but notice the very long (month ish) consolidation occurring in the bond market.

Today’s price action appears to want and break the support that has been around since March 15th. As you can see above, we do some ‘basic’ projections and right when the neckline breaks there is minor support (blue projection arrows) and then the BIG support w/ the blue rectangle present. A lot of math coming into that level. I believe that is the crucial level.

As you can see from the weekly chart above, the “time” of the corrections have been pretty symmetrical so from a timing perspective certainly looks like this “bounce” has run it’s course for one more leg down.

From the ATH, it’s a pretty clear count and I’m labeling this as a 4 completing/completed and another leg down (rates go UP in this case) into the .618 from the 1981 low (40+ years ago) in bond prices. Note the blue measured move above .. that was the largest correction in 40+ years. We take harmonics from that and you can see the square root of 3 harmonic nailed the low precisely. We have a .618 retrace, 1.618 extension, trend line coming from the low in 1981 and a harmonic of the largest prior correction.

That level is a good level to BUY – if we get down there.

TBT – decision time

well, underwater on TBT. I’ve shown my entry and man did that look like a NICE one .. but, it’s all probability. folks there was a TON of math coming together in /around 17-18 and it got wiped out. but, we have some support holding at the .707.

I’ll cut half my position on TBT if we lose 16.06 to the downside on a DAILY close below.

I’m still bullish RATES but … trade what you see, right? let’s give it a couple more days and then might need to throw half a towel into the ring on this one …

also, I’ve done the 30 year continuous futures contract INVERTED to show the same picture at TBT and to also see if there is some support that might be found on this one … hmmmmm. can’t win em’ all …

investing is like golf .. learn how to play out of the rough and the sand and you will be a good golfer! I’m still learning!

TBT update

last post on TBT: https://bartscharts.com/2021/06/20/tbt-3/

TBT has fallen into the bottom level of BUY zone and I’m long TBT in/around 18.

A lot going on w/ his chart but wanted to show you some “other” geometry that I was working … you see, we can make arcs and develop trend lines using the geometry of the chart but also, using the TIME and PRICE to define the vectors.

in this case, we take the all time low and draw the bottom of the square to intersect the “time” of the high. that will define our arcs and the square. the most important aspect of a square is the 45 degree angle (red line) and that line we then “copy” and “paste” to the bottom right of the first square and, well look at that … it intersects the LOW almost exactly. we also draw another square (and we can/will keep drawing these squares to find the trend lines running the show) and notice how the two 45 degree angles TIMED the low almost exactly .. (FWIW, this was a precise 1.618 AB =CD and a .618 retracement along w/ the same percentage corrective move that drove price into the all time low … came in around 21-22 percent decline.

so, while we do have the traditional “slap a retracement grid and look for the .618 retracement and a whole lot more …

take some time to study this chart .. try to understand it as it’s very helpful, indeed.

and, w/ all this work, I’ll consider it “wrong” if we get a daily close below 16.08 (.786 retracement)good weekend to everyone …

Bart

TBT – tricky

please see chart below … ultimately, it’s about risk control and how much risk one is willing to take.

our thesis is the 14-15 dollar low was a BIG low and we are very early in a multi-year (multi-decade (?)) rise in interest rates. yup, you just read that correctly …so to manage risk, one must understand that there is a potential that the trend has changed and we now have 3 different levels to enter …

here and now … GARTLEY 222 pattern complete at the low however, a nice gap down warns of lower prices. gaps into a level beg of caution …

19.14-19.42 …realistic w/ that gap down and lands basically on the top of the channel w/ polarity in play.

18-18.50 .. a lot of ratios and polarity principle (red line) … that looks good.

so, if the low today was the low but you don’t like the gap down then WAIT for a daily/weekly CLOSE above 21.50 for confirmation and BUY or if you do not think the low was today then WAIT for the two levels below.

either way, risk is basically in the 16-17 former cluster or the low at 14.28. that’s the true support zones. the lower breaks then the entire thesis is 100% wrong.

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