TBT, U.S Bonds

Today we update this post from May 29 titled "SJB, U.S. 30-Year Bonds, 10-Year Notes, TBT, Gold and Silver"

In it we wrote: "... we're very confident of much higher rates, and the rates will turn higher much sooner than anyone expects and regardless of so-called Quantitative Easing efforts continuing or not."

We showed two charts suggesting that TBT, an existing holding, looked ready to break-out.  It did, coinciding with rates popping higher and sooner than most anyone expected.  TBT hit a fresh 52-week high this Friday, closing 14% higher than when we made that observation. 

Below is an updated TBT chart.  We expect at least 1/3 of that multi-year drop to eventually be retraced.

On the flipside of rising rates, this has meant that U.S. debt didn't bounce where there seemed to be technical support (see charts in link above). 

Here's how the U.S. 10-Year Note and 30-Year Bond looks to us now:

 



As can also be seen in that posting linked above, we've been correct about shorting junk bonds via SJB.  The suggested options in that post have since traded as much as 550% higher, while the shares have been up as much as 10%.







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