Monthly TLT Historic Oversold Reading

TLT

TLT, the long bond ETF is approaching a historic oversold monthly reading due to the coming rate hikes.

The Fed would like us to believe that they will raise rates 6 more times this year, which would of course destroy bond prices.

It's not going to happen....

The Fed has raised rates once thus far, by just 25 bps and the market is already down 15-20% from the highs.

The US National Debt has ballooned above $30 Trillion, and every 100 bps adds 300 Billion in ANNUAL debt service expense.

Those who time the interest rate peak, will be handsomely rewarded by going long bonds as the Fed is forced to stick their foot in their mouth and admit that the US economy is hostage to it's debt and dependent on low rates to sustain growth and keep the markets afloat.

The interest rate threshold that causes a major systemic event gets lower and lower as the US is more and more indebted.

https://twitter.com/MacroAlf/status/1494054446019616770?s=20&t=97lYQeuoBvpG5jzT31_3sg

I believe that a combination of an intense market sell off and/or peaking rates somewhere around 150 - 175 bps will mark the bottom in bonds.

I own no TLT at the moment; however, I will start scaling into a position over the next few months depending on the market reaction as we progress through the coming gauntlet of FOMC meetings (May/June/July)

A test of the lower bound of the Modified Schiff Pitchfork will be my signal to go long.

I'll update this idea with any TLT moves I make.

Comment:

Bought some TLT today. Not too much, just a starter.

Couldn't resist.

Comment:

Went into a big long TLT position on 7/27, post rate hike decision.

Rate hikes are coming to an end, long it!!!!