Bonds Setting Up To Skyrocket

For those asking about my public article on bonds, here it is:

Over the last decade, how many times did you see various analysts and traders call for the end to the bond market?

For many years, many were calling for the end to the bond market almost weekly.  And, as we know, until 2016, they were continually wrong.

However, on June 27th 2016, I wrote an article entitled “Beware of Bonds Blowing Up.”  And, that was my first article calling for a top in the bond market.  As we now know, within two weeks of that article, the bond market struck a major top which has not been exceeded in almost 3 years.  In fact, the TLT dropped 22% since it struck its high two weeks after my article.

Then, as we were approaching the end of 2018, I was again warning those who subscribe to our service that bonds were looking like they were finally bottoming, as we approached my major support region noted on my chart.  In fact, I noted in our chat room that I was buying TLT when we struck 113, and my initial target for it was in the 124 region before I think we would see a pullback.

As you can see, these two charts outlined my perspective on TLT for both the bottoming I expected in TLT, as well as the initial target I was looking for off those lows.

At the time I began buying TLT, so many were arguing with me about how I can even consider buying bonds when the Fed was still clearly going to raise rates.  They believed that the Fed leads the bond market whereas I believe that the market sentiment leads the Fed.  I think the market sentiment clearly won out on this one.

As I have also outlined to my members, I was looking for a pullback from the 124 region back down towards the 118 region for another buying opportunity.  And, interestingly, I did not care what the Fed was going to do at this time either, as market sentiment, based upon the manner in which I track it, was pointing to the 118 region from the 124 region.

My next higher target overhead is a minimum of 128, but with much stronger potential to well exceed that region.  While I am not going into much greater detail in my public article, I simply wanted to highlight that the bond market is likely within several weeks of bottoming out, and setting up another strong rally higher.

And, guess what?  I don’t care what the Fed will do or not do, as market sentiment will lead the Fed as it normally does throughout the history of the Fed, as you can see from the attached chart.

TLT
TLT
Avi Gilburt is founder of ElliottWaveTrader.net.