USO - Prudent Investors Pay Attention To The Extraordinary Treasuries' Move – Momo Obliviously Buys Stocks | Benzinga
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Extraordinary Move In Treasuries
Please click here for an enlarged chart of 20+ year Treasury bond ETF (NASDAQ: TLT).
Note the following:
- The chart shows that TLT has fallen below the support/resistance zone. This prior support zone has now become a resistance zone.
- The chart shows that after a breakdown below the zone, Treasuries have continued to fall.
- The chart shows a downward sloping trendline and a significant move lower away from the trendline.
- The chart shows that the down move is on heavy volume. This indicates conviction.
- Historically, at a time of geopolitical tension, money rushes into U.S. Treasuries, and U.S. Treasuries rocket up. Based on history, on Iran attacking Israel, U.S. Treasuries should have moved up. But as the chart shows, Treasuries have continued to move down.
- In The Arora Report analysis, Treasuries moving down in spite of the Iranian attack on Israel is quite extraordinary.
- Prudent investors pay attention when something extraordinary happens in the markets.
- Lower Treasuries mean lower stock valuations. All investors should fully grasp this point.
- As is their pattern, the momo crowd is oblivious to this extraordinary development and is buying stocks. The momo crowd’s buy the dip without analysis mentality is on full display.
- Fed Chair Powell has been itching to cut interest rates. Clearly, the bond market is not only defying him, but it is telling him he is wrong. Powell will be participating in a Q&A. We will be paying close attention to what he says.
- San Francisco Fed President Mary Daly is saying there is no urgency to cut rates.
- Wall Street seems to be coming around. A major bank is accepting the real risk of a rate hike. Of course, members and readers of The Arora Report, already knew in advance that the data could force the Fed’s hand to raise rates at a time when everyone expects rate cuts.
- Lower Treasury bonds mean higher yields in the U.S. Higher yields mean a higher dollar.
- Central ...