Interest rates bottom, TBF moves higher

Look at this chart. It shows the ProShares Short 20+ Year Treasury ETF (NYSE: TBF). As an inverse fund, TBF goes higher when interest rates go higher and bond prices go lower.

You can see how TBF (and interest rates) created a V-shaped bottom last October.

Soon after, the Relative Strength Index (RSI) began showing bullish divergence – a signal for higher interest rates (and TBF prices).

As TBF traded sideways it seemed $31 was holding as support. We alerted Boom & Bust subscribers of this bottoming behavior and recommended moving stop loss orders to $30.50.

This move reduced our risk, but also gave time and room for TBF to go higher… which is what we’re seeing now.

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Categories: Economy

About Author

Adam O'Dell has one purpose in mind: to find and bring to subscribers investment opportunities that return the maximum profit with the minimum risk. Adam has worked as a Prop Trader for a spot Forex firm. While there, he learned the fundamentals of trading in the world’s largest market. He excelled at trading the volatile currency markets by seeking out low-risk entry points for trades with high profit potential. An MBA graduate and Affiliate Member of the Market Technicians Association, Adam is a lifelong student of the markets. He is editor of our hugely successful trading service, Cycle 9 Alert.