timwest
Short

Bonds Over Gold (TLT/GLD Ratio) - Deflation Fears Rule

TLT/GLD  
TLT/GLD  
509 3 10
When the market fears INFLATION , Bonds go down and Gold             goes up, driving this ratio lower.

When the market fears DEFLATION, Bonds go UP and Gold             goes down, driving this ratio higher.

We have just finished a major "deflation fear" wave that has failed to make a push during this entire stock market decline in the past 5 days. Since this ratio has stalled out during this stock market slide (5%), I am going to view Bonds as a low risk short sale with specific parameters, to be discussed.

This looks like a normal "wave" of "deflation fears" with bonds dramatically outperforming gold             and just a slight underperformance by bonds ( TLT             ) versus gold             ( GLD             ) and this ratio will turn down and give a low risk short sale. If the stock market "crashes", then you do NOT want to be short the bonds, as they could rally 5-10 points in a matter of days. Keep your risk in control and low. Use options to manage risk if you fear outright losses from short positions.

Tim 1:23AM EST 10/14/2014
Subscribe to my indicator package KEY HIDDEN LEVELS $20/mo or a discount for a year and join in the trading room KEY HIDDEN LEVELS here at TradingView.com
2use
2 years ago
To those who can't do shorts or options you advise to keep on the sidelines and keep some bonds still?
Reply
timwest PRO 2use
2 years ago
The big 5+ point jump in bonds was the mini-correction (not really a crash), but shows how dangerous the bond market can be for traders. From a long term perspective, this is a great time to take money off the table in bonds and move it over into gold. That's how you have to think to be successful - a bit different from the crowd.
Reply
2use timwest
2 years ago
I guess im already am, already added to gold more than a week ago.
Reply
Ideas Scripts Chart
United States
United Kingdom
India
España
Italia
Brasil
Россия
Türkiye
日本
한국
Home Stock Screener Economic Calendar How It Works Chart Features House Rules Moderators For the WEB Widgets Stock Charting Library Priority Support Feature Request Blog & News FAQ Help & Wiki Twitter
Private Messages Chat Ideas Published Followers Following Priority Support Public Profile Profile Settings Billing Sign Out