PeakTrader.com

[arthur]

There's almost a perfectly negative correlation between TLT and the 30-year bond yield. Over the past two years, the 30-year yield has been bottoming at 4.2% to 5.5%, after being in a downtrend for over 20 years. On Friday, the 30-year yield closed at 4.65%, which is in the lower half of the range. For each 0.10% move in the yield, TLT moves roughly one-point. So, if the current yield rises from 4.65% to 4.75%, TLT will fall from 90.70 to 89.70. The long-bond yield may rise, perhaps sharply, over the next few years, causing a downtrend in TLT (which I may explain in an article soon).