Friday, September 25, 2009
Had an issue getting this chart posted. So without further delay, a daily view (above) of the i-shares Barclay 20yr bond ticker TLT or the TLT's as they are called. I have been watching the 97 level which we broke thru Sept 2 with an encouraging close there, only to fall back and break thru again Sept 11 but failing to close there. Today we are thru $97 and we look strong enough to close there.
I may live to rue those words, close there, but if we can then this will be a weekly close above 97 and hence very encouraging for bond bulls. Remember when bond prices are rising like the TLT's it means rates are falling.
You may ask why is my stop at 94.94, well this is 2x the 20 average true range for the TLT's.
You may also ask why is he bullish of US. government debt given its profligate ways and the fact the Julian Robertson says we have to "pay the piper" Well, first there is no question the Feds never met something they wouldn't throw money at like a drunken sailor but in a world of profligacy and fiscal and monetary ignorance again the one-eyed man is king among the blind.
As for Mr. Robertson, founder of the very well know Tiger Fund, he is THE papa cub as he has trained and mentored many traders who have gone on to much success and are known as his cubs. Mr. Robertson is brilliant, clear thinking and to be watched closely but he is by no means perfect as evidenced by his ill advised foray into U.S. airways made only worse by averaging down (even the best succumb) as the stock cratered. His call for interest rates of 15% would render a long position imbecilic but yet I am prepared to execute it. It just wouldn't be right if the trade wasn't that hard.
Lastly, I will bet with the bond boys and against the equity boyz any day of the week as regular readers know which of these two groups I think has 'room for let' tattooed on their foreheads.
Good speculating and please remember to never forget that "an investor is a speculator who made a mistake and will not admit it".
Long 1 unit Ultrashort Russell 2K ticker TWM @ $27.50 stop @ $26.40
Long 1 unit Ultrashort Financials ticker SKF @ $24.55 stop @ $23.49
Long 1 unit i-shares Barclay 20yr ticker TLT @ $97.80 stop @ $94.94
Short 1 unit i-shares Russell 2K ticker IWM @ $61.70 stop @ $63.80
Short 1 unit Costco ticker COST @ $58.00 stop @ $60.11
Short 1 unit Vornado ticker VNO @ $68.30 stop @ $70.71