Bonds (TLT) must hold the line
One of my favorite trades of the year has been bonds. Up 10% YTD, our bond proxy, TLT (an ETF), is now at an important inflection point. Recently, it made a lower low and a lower high. Today, it bounced off an upward trendline that runs parallel to the dominant trendline for the past 6 months. It must stay above this trendline and continue daily closes above the line in the sand (dashed line at 110.67), in order to remain long. If it complies, and can clear the last two recent highs, I would consider adding to this position (let’s worry about that later). If it does not hold here, we’ll take our 10% and find something else that likes to increase our portfolio.
Have a safe 4th of July. Remember our independence!
David Zarling, CMT is Head of Investment Strategy and Research for Client First Tax & Wealth Advisors, a Registered Investment Advisor. Using his strong industry insight and background, David is responsible for managing our clients’ investments using the Adaptiv Investment Management System. This proprietary approach is built on the bedrock of supply and demand (aka price), which is used to identify investment trends across all asset classes: stocks, bonds, commodities, and currencies. This top-down approach has proven effective for managing risk in a variety of market environments. With 19+ years of experience in the industry, David brings institutional-class asset management to our clients’ portfolios.
