30yr on the way to 2.5%?

It would seem so, as the current NFTRH target awaits despite a hawking Fed

While day to day it can be frustrating watching a plan play out in a volatile market, we have nailed the interest rate backdrop that the now hawking Fed has been whipsawed by and is trying to catch up to. But over educated eggheads will be over educated eggheads, and as they chase the inflation story…

…Treasury bonds are busy rallying as yields pull back.

30 year treasury bond yield

…and our target of 2.5% looks doable, as the uptrending daily SMA 200 above coincides with the big picture monthly ‘Continuum’ objective of a test of the (formerly) limiting EMA 100 & 120 and the neckline to the pattern that we also nailed as we entered the meat of the inflationary phase.

As a side note, check out the Continuum’s news threads. It has exchanged its former red ‘limit’ suit for a green support suit. Something has changed on the macro and this is reflective of that something. I really dig this stuff.

Bottom Line

You’ve got to have the macro right in order to have a chance to deploy correctly and there is (IMO) not much that is more important than bonds and other signalers of the inflation/deflation situation.

I am, and NFTRH is taking cues from the bond market, among other signals, about how to be positioned. To varying degrees, always have and always will as long as the current system holds together. When it breaks up, new or at least additional tools may be needed.

In classic form, the Fed and its dignitaries are chasing yesterday’s news. That inflationary news may also be tomorrow’s news, but tomorrow is due for a continued interruption which, you may recall, we were well out ahead of. It’s the only way to manage seemingly unmanageable modern markets.

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This Post Has 7 Comments

  1. largefeline

    I don’t put much thought into my positions. I’m short on stocks I didn’t like from my “IT” background. Screened the Russell 2000 for companies with >2B valuation and sorted by price/revenue descending inspired by reading Hussman’s ideas. My only position with a theta is a jan23 XLK put. I’m not emotionally attached at all and I’m just waiting for my positions to turn a profit based on my conviction that this market is bound to fall with the catalyst being an active fed.

    1. Gary

      Yes Big Cat, that’s what is so cool. How we can have such differing methods and viewpoints. For me, it’s indicator nerd. For you it’s conviction. My thing actually requires me to go against my convictions often enough. For example, when I learned not to be a perma-bear back in 2003.

    2. Interesting post as a week ago to me it said all lines meet at 250bps (at least for now/near term). 90day tbill was planted there. The 75bps puts you there and no reason to think the curve doesn’t stay pancaked together for a while.

      1. Gary

        It’ll be interesting though when the curve stops pancaking. Thoughts on that?

  2. MikeC

    Me looking at GDXJ and GDX this morning…No No No, they’re getting away….oh, no they aren’t….patience. wait till Wed/Thurs and see.

    1. Gary

      Good call.

  3. MikeC

    Interested in anyone’s thoughts — we are all to some extent different, being more into commodities, gold, etc. And certainly looking for some resolution here in the next week or so on a direction for at least a few months.

    Wondering if anyone does XME to cover miners vs, for example, GDX and GDXJ? YTD, 1Yr, 5YR and further all show XME with a better return.

    I am just trying to cull the number of issues I watch, and this was a thing. Thanks.

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