if the fed does not keep borrowing rates in check the politicians will make life very uncomfortable for the Fed - one hand washes the other. Never forget the game as it is truly played. Pol's need the fed so they can deficit spend to get re-elected - fed needs pols to stay in the cartel game.
too high imo...far too much of the govt revenue as % of GDP would be going towards debt service. With current slow growth the market multiple would get slashed down and thus tank city. Combine with high gas / crude and a real molotov cocktail. Fed would rather let equities go and get the safe haven flight to Tresuries so they can dump some at higher prices. Remember the buyer of treasuries right now is the fed and no way they go down with the ship ever
None taken, very well could be some sort of massive bull flag forming. 61.8 should at least provide a bounce, but if not the 76.4 retracement is right in the sweet spot of where I was projecting -- which I realize would be rare unless yields are about to go ape above 5% (which I don't see happening anytime soon). Good call out though, I saw a little support in that area but didn't realize the Fib was there (lazy LOL). I might've over-thought the setup by including bias from the previous chart projection. Happens!
interesting you say that since my largest long position is in that exact trade (although I do own bonds in some 401's. In essence my stance is that if yields spike then short equities is the play (on that already) and as you state long dollar is my hedge on the long bond. BUT if bonds and dollar rally and equities fall I will all bets.
I've heard a few really smart guys whom I trust echo this sentiment today. Regardless, I'd like to see a bounce to a slightly higher high above 107.75 followed by a higher low before I begin incorporating the basing hypothesis as a possible outcome. Idk, very confusing right now if watching any more often than on the daily chart, at least for me.
actually I feel good about my pov - it works for me and it helps me to navigate on a bigger picture. I am essentially using common sense to decipher the most obvious and likely result over the long pull. Not a trade rec obviously - dyodd
the fact that i feel good about it IS my conviction. Not telling you to have the same pov OR conviction - of course. Most are playing this trade 100% opposite so it would not be any great shakes to my ego. But I enjoyed the back and forth.
Can't play this trade any more opposite than me -- sidelines! Too many ways it can go for me right here. A straddle might be a good call. I've worked out a pretty solid if/then thesis to respond to coming action. Expecting the market to change course has not been a very rewarding thesis so far this year for me. I've got long and short exposure to the market with a short bias. Once the story speeds up I'll be ready to jump into action. (and by the way, we both know the opposite side is usually the right side ;)...).