Powell says Fed may raise interest rates above `neutral'
Oct. 3, 2018 5:04 PM ET|By: Liz Kiesche, SA News Editor
( the 30 year bond yield was up +3.49% today!!!!!, the 10 year yield was up +3.44% today...... and the
$FVX = 5 year note yield was up +2.72 what a massive bull market in yield........
today was a ring the cash register day for those of us short treasuries across the entire yield curve... the long end from 7 years out to 30 just got better and better the further out you were on the yield curve with
your shorts and steepening strategies........
who knows the last time that any US equity index was up + 3.49% in a single day????????)
The ANSWER IS YOU DON'T
-----------------------------------
Federal Reserve Chairman Jerome Powell repeats the Fed's intention to continue raising interest rates at a gradual pace that may push rates above the so-called "neutral rate," the point at which the rate neither helps nor hurts economic growth.
Powell commented on the economy at an event in Washington hosted by The Atlantic magazine and the Aspen Institute.
“We may go past neutral. But we’re a long way from neutral at this point, probably," he said.
Similar to his speech yesterday in Boston, he remarked how the U.S. is currently experiencing “a remarkably positive set of economic circumstances."
“There’s really no reason to think that this cycle can’t continue for quite some time," he added.
U.S. 10-year Treasury note yield gain 12 basis points to 3.185%. ( TLT-1.7%), ( TBT +3.6%)
Previously: Fed's Powell considers the paradox of low inflation and low unemployment (Oct. 2)
Now read: Wait To Buy Bonds Or Buy Bonds And Wait? »
seekingalpha.com
-------------------------------------------------
THE MASSIVE BREAKOUT IN YIELD ON THE 30 YEAR BOND TODAY!!!!!!!!!!
1 YEAR DAILY CHART
the full stochastic are under 65 and 48 respectively..... they will both easily go to 80 in the short term... very powerful trend!!!
THE 5 YEAR WEEKLY 30 YEAR BOND YIELD
5 year weekly TLT.... TLT is in a bear market as the entire yield curve moves higher in the USA...
so the big money is being made being short bond futures....or going long vertical bond futures puts that are @ the money .. buy the at the money put and write the same month that is 4 or 5 strikes below.... You have an absolute defined max loss and the ability to make a 23 to 43 % profit in a few weeks. Profits are capped but that's cool by me.......
Te Iron condors puts are amazing as you have Bear Call spread and a Bull put spread on the strategy....
The 2 credit spreads are often used together, not because it is necessary, but because they share the same amount of capital at risk.
Because loses can not be realized on both credit spreads, brokers only hold margins on one of them...
you would want to buy a protective out of the money Put on the short Bond vertical spreads in case of a
disaster.... or alternately... get protection by getting long in expensive short dated out of the money puts on the SPX or NDX ... as the vertical spread puts in the bond futures would loss money in the event of a swift 10-15% down move in the SPX or NDX.
----------------------
The 10 year note is definitely in a bull market in yield and a bear market in price.... wage inflation is showing
up all over the place....... as is inflation going into the costs that most companies are incurring in their
businesses.... and yet, they have been telling Economists and strategists at the WS firms, they are not willing to pass price increases along to the customer, as we have a global overcapacity problems
I was talking with a Brazilian investor today , he keep telling us how bad and dangerous things are in
Brazil... he has no faith in the government whatsoever.......
the Brazilian ETF did have a big time Election rally ..... however, it's almost certainly a bear market rally that
can be shorted as we come into resistance overhead..... what a fabulous short as it approached 38 today
with the descending slope of the 200 Dma @ 38.45 and a double top with the early AUG high...
--------------
15 YEAR WEEKLY BRAZILIAN ETF --EWZ
John |
