U.S. T-Bills Peak At Resistance: A Good Sign For Stocks
Chris Kimble | Jul 14, 2016 10:30AM ET
For the past year, the Fed has hinted it would raise interest rates. But investors haven't bought what Janet Yellen has been selling, driving yields lower and bond prices higher and higher.
Take a look at the 20-Year bond's ETF TLT over the past decade.
No doubt about it, TLT remains in a 10-year rising trend, highlighted by channel (A).
The nice rally in TLT this year has pushed it up to the underside of rising channel (A). At this point, it's actually kissing the underside of two potential resistance lines at (1) above.
As it eyes this resistance, TLT is trying to breakout for the fourth time in the last ten years. At the same time, weekly momentum is getting pretty lofty.
Stocks Keep Going
Is it possible that the S&P 500 is breaking out to new highs while bonds peak; and at the same time?
It seems technically clear that TLT is at a very interesting price point.
And if TLT happens to peak as stocks rally, it will indicate that markets have accepted an EU without England.
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