Wednesday, July 17, 2013

Will the Bond beating continue? Upside interest rate target is?

by Chris Kimble

CLICK ON CHART TO ENLARGE

The chart above reflects how a variety of assets performed over a 70- day period of time, ending July 10th. As you can see the top performing asset was the inverse bond ETF TBF, as interest rates rose sharply during this time frame. 

During this time window TBF made three times as much as the S&P 500 and made investors as much in two months as the S&P 500 has for the year!

The chart below reflects a pattern that suggested interest rates were about to "Blast Off and Bonds could get hurt" before it happened (see post here)

CLICK ON CHART TO ENLARGE

The above chart reflected a double bottom in yields and a bullish inverse head & shoulders in yields, suggesting a sharp rally in interest rates was about to take place...and it did.

Will the Bond Beating continue?

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