TLT, weekly
TLT, monthly'4, with outlook
Summary
*I rarely comment/highlight bonds.. but increasingly intend to, as we proceed into the summer/autumn.
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So... what about TLT?
My broad outlook is for one last multi-month up cycle for bonds.
The weekly cycle is offering a double floor in the 123/22s. It will be important to recognise if this level fails to hold... more viable after the next jobs data.
The giant monthly cycle is offering a large bull flag/pennant, with the 140/50s viable by Aug/Oct time frame.
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**I've never actually traded TLT, but will be seeking to short US bonds later this summer/early autumn... preferably in the 140/150 zone. First downside target would be the 100/95 zone.
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US fed rates.. with sp'500
Many are still dismissive that the fed will be willing (never mind able) to raise rates EVER again. Personally, from late last year I had expected a rate rise between March/June.. but am now resigned to it happening no earlier than Sept.
If the broader market is stable.. with US GDP at least +2%... and regular monthly jobs gains of +200K, then the Fed will be under strong pressure to at least raise rates to 0.25% from the current 'target zone of 0-0.25%'.
There is the grander issue of a Public to private capital shift - as Armstrong regularly speaks about, but for now, I'll leave it at that.
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The 'old leader' is merely consolidating
If you can agree that the Transports is indeed still the 'old leader' (after all, everything has to be transported at some point)... then the current price structure should really concern the equity doomer bears.
Whilst the underlying MACD cycle has almost fully reset back to levels last seen in late 2012, prices are only a little lower than the high of 9310 (Nov' 2014).
Frankly, if this was the only chart I followed as a guide for the broader market, I'd be calling for a major move higher in the next week or two. Certainly, if we see a weekly close in the 9300s, it will bode for the giant 10K threshold by late summer... which would be suggestive of sp'2250/300.
I realise to some of you out there, the notion of a push higher across much of the summer is crazy talk.. after all, we're going to crash, right? I can only suggest... go stare at the above Transports chart for a good hour.
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Looking ahead
Tuesday will see intl. trade, along with ISM/PMI service sector data.
*Fed official Evans will be speaking around midday.. and Mr Market will no doubt be listening.
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Goodnight from London