{"id":17100,"date":"2021-02-08T07:30:27","date_gmt":"2021-02-08T12:30:27","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=17100"},"modified":"2021-02-08T07:30:27","modified_gmt":"2021-02-08T12:30:27","slug":"treasury-bonds-are-setting-up-for-a-risk-off-rally","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/treasury-bonds-are-setting-up-for-a-risk-off-rally\/","title":{"rendered":"Treasury Bonds Are Setting up for a \u201cRisk-Off\u201d Rally"},"content":{"rendered":"

After trending lower for the past several months, Treasury bonds look ready to rally.<\/p>\n

We’ve been bearish<\/a> on T-bonds for most of the past year.<\/p>\n

We warned the bond bubble looked ready to pop last March<\/a>. Then, we cautioned that T-bonds looked ripe for a sharp decline last October<\/a>. And finally, we argued for a continued breakdown in the Treasury bond market in early November<\/a>…<\/p>\n

Now though, conditions are oversold enough that we could see a quick rally in U.S. Government bonds.<\/p>\n

Take a look at this updated chart of the iShares 20+ Year Treasury Bond Fund (TLT)…<\/p>\n

\"\"<\/p>\n

TLT has been in a steady downtrend – making lower lows and lower highs – since August. It’s approaching support<\/a> near $148 per share. And, the chart has formed “positive divergence” on the recent decline.<\/p>\n\n\n\n
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In other words, as TLT has dropped to a lower low, the various technical indicators have made higher lows. This sort of positive divergence is often an early warning sign of a reversal higher.<\/p>\n

TLT had a similar setup in early November, just before a quick, two-week rally in Treasury bonds. A similar move this time could pop TLT back up to $155, or so, by the end of the month.<\/p>\n

It’s worth noting that this potentially bullish<\/a> setup in Treasury bonds is happening while bearish setups are forming in other “risky” assets.<\/p>\n

Investors and traders have been piling into speculative assets, without much concern for the risk of those assets. That’s usually what happens in a momentum-fueled rally \u2013 folks get rid of their conservative investments and throw money at “risk-on” trades.<\/p>\n

But – for reasons we’ve pointed to over the past couple of weeks – it looks like the hot money is approaching a cooling-off period. And, as money comes out of those risky assets, it’s going to flow into “risk-off” assets like Treasury bonds.<\/p>\n

Based on the look of the TLT chart above, that risk-off rally could get started soon.<\/p>\n

Best regards and good trading,<\/p>\n

<\/p>\n

Jeff Clark<\/p>\n

P.S.<\/strong> Following the highs and lows of the bond market may not be everyone\u2019s preferred way of quickly making money, but I\u2019ve found a single stock that could help generate gains month after month. <\/p>\n

Most people wouldn’t even look twice at this tiny stock, but it’s one of my best-kept secrets. You see, using just this “boring” stock<\/a>, I’ve seen gains of 161% overnight… And, I believe it has the potential to do even better for you.<\/p>\n

So, click here to learn more<\/a> about using my secret strategy and this little-known ticker.<\/p>\n

Reader Mailbag<\/strong><\/h2>\n

Have you made significant gains by being bearish on Treasury bonds these past few months?<\/p>\n

Let us know your thoughts – and any questions you may have – at feedback@jeffclarktrader.com.<\/p>\n","protected":false},"excerpt":{"rendered":"

Another reversal is on the way…<\/p>\n","protected":false},"author":25,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-17100","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/17100","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/25"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=17100"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/17100\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=17100"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=17100"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=17100"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=17100"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=17100"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=17100"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=17100"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}