TLT: Mother of all short squeeze
Everyone is trapped in the narrative of the FED's rate hike.
The bus of short 10 year treasury is full. Its time for a train derail.
In a risk-off environment, do you think the FED will ever hike rates further?
Adding another level of uncertainly is the cancellation of the Trump-Kim summit in Singapore. Including the recent crash of Italian bonds, EU drama yet again (potentially 5x bigger than Greece)
The only place funds can reposition themselves are the US dollar , and US debt/treasury. Uncle Sam .
The VIX is currently near lows once again. ~13
It is time to counter-trade that, and reap the rewards of the short covering along 117 support line. You have only 2% to risk.
Just buy August 2018 - June 2019 call/ bull spread and close your chart. No stop loss.
If it doesnt get there, you lose your investments. If it does, you get back 5x~20x your investments.
All conditions are perfect.
Letting other 3/4 ride.
Some capitulation intra-day... 5 more days to FED meeting ;)
let's squeeze those pesky bond bears.
Let's see if everything starts snowballing from here.
Powell did hint on possible QE on the next downturn again.
It might take some time, major squeeze could come as soon as the FED reverses.