I’m going to be direct. I like the way bonds are setting up again. Before I invest/trade in TLT I look at bond futures for a signal. Take a look at this chart of 30-year U.S. Treasury Bond Futures. This is bullish price action. We’ve climbed off the lows and now bonds are building up energy as they move sideways for a potential move higher.
So what’s the play?
I take my signal from the futures market, but I use TLT to capitalize on this information. Take a look at TLT. It’s appears to be setting up to challenge the recent $115.19 high. There are a number of things you can do with this information.
Before I go on in full disclosure we’ve held TLT for clients since the first week of April.
Back to what you can do with this information. One of the easiest things you can do is buy TLT shares and sell them once you hit a price target. The more adventurous might wish to purchase Delta 70 calls with a 45-60 day time frame. You’ll want to start scaling out as you start to encroach on your first set of price targets. You don’t want to hold these calls to expiry.
You have to know how to set price targets before you ever enter a trade or investment. You have to know what keeps you in and what gets you out to the upside and downside. Just as important you have to develop the skillset that allows you to know when to hold through a sideways move or small pullback.
I’ll be hosting a complimentary webinar on Tuesday July 8th at 7PM central that covers exactly what I described above. If you’d like to learn how to invest and trade in this manner please use this link to register for the class –
I’m a self-admitted stock nerd. Every weekend I produce a video for my fellow stock nerds and market enthusiasts. If you’d like to watch it please click this link – http://noramassetmanagement.com/videos/weekend-video-update-11/
I hope this helps!
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