TLT trade ideas
Opening (IRA): TLT July 19th 86 Short Put... for a .98 credit.
Comments: Adding to my TLT position on weakness here, targeting the strike paying around 1% of the strike price in credit.
I already have rungs on in April/May/June, so am adding a smidge out in July.
With QQQ and SPY knocking on ATH's, holding off on my usual broad market plays to await weakness and/or higher IV.
TLT to $86 and 20 year yield to 5.2% by 5/3/24?TLT to $86 and 20 year yield to 5.2% by 5/3/24? I think the current break out by long bonds into the 5%'s has enough momentum to take the 20 year to 5.2% and TLT to $86. Bought into TMV on 4/24/24 and will hold until we reverse. The PCE report on 4/26/24 will confirm this move or invalidate it.
$TLT, the last bond rally before bear market continuation?NASDAQ:TLT seems to be setting up for one last move higher. I think we're likely to see a bottom of the short term move between around here at $92.
Then I think post fed meeting, we'll get a move in TLT up to the $98 resistance, that's where you'd want to be a seller of TLT or buy puts.
After that, I think largely the remainder of this year will be bearish bonds after the $98 resistance gets tagged.
I also think we'll see new lows (I know this is very opposite of what most people think will play out). This is also likely the catalyst that brings down the stock market (rates rise more than people think is possible).
Let's see how it plays out.
TLT... Time to Buy?Good R/R for a long down here, especially with a potential for a weekly hammer to set up a higher low from the 2023 bottom. Especially with a seeming "risk off" in the markets could be an attractive place to look for returns. Been bleeding for a long time... plus take a look at the volume since the bottom.. highest volume since inception at the bottom of the chart
Let's Not Be Blind to our Blindness..!Nassim Taleb's:
“My lesson from Soros is to start every meeting at my boutique by convincing everyone that we are a bunch of idiots who know nothing and are mistake-prone, but happen to be endowed with the rare privilege of knowing it.”
He also said:
"The only economic research that seems to replicate out-of-sample is the work of Daniel Kahneman on behavioral biases."
This phrasing reflects Taleb's critique of traditional economics and his acknowledgment of Kahneman's work on human decision-making, which can be tested and applied in real-world scenarios.
Taleb has discussed Daniel Kahneman's research on behavioral economics, particularly Prospect Theory, which studies how people make decisions under uncertainty.
A Wisdom from Daniel Kahneman:
Not only are we sometimes “blind to the obvious,” but also we are “blind to our blindness.”
We all have our own unique experiences and ways of thinking. This can make it hard to see things from a different viewpoint and recognize our own blind spots.
Here are some things you can do to overcome this blindness:
Be open to feedback: Ask trusted friends or colleagues for their honest opinions.
Seek out diverse viewpoints: Read books and articles from people with different backgrounds.
Challenge your assumptions: Actively question your own beliefs and biases.
By being aware of our limitations, we can start to see the world a little more clearly.
Prospect theory is a behavioral economics model developed by Daniel Kahneman and Amos Tversky in 1979. It challenges the idea that people make decisions based solely on logic and maximizing expected utility (total value of possible outcomes). Instead, Prospect Theory argues that:
Decisions are relative: We judge gains and losses relative to a reference point, often our current wealth or situation.
Loss aversion: People feel losses more intensely than equivalent gains. A $100 loss might feel worse than a $100 gain is satisfying.
Diminishing sensitivity: The impact of gains and losses diminishes as the amount increases. A $10 gain might feel more significant than a $100 gain.
Here's how these ideas influence decision-making:
Risk aversion for gains: When faced with choices involving gains, people tend to be risk-averse. They might prefer a guaranteed smaller gain over a risky chance of a larger gain.
Risk-seeking for losses: When faced with choices involving losses, people might become risk-seeking. They might choose a gamble with a chance to avoid a loss, even if the odds are not in their favor.
Prospect theory has numerous applications in understanding human behavior in various fields, including:
Investment decisions: Investors might be more likely to hold onto losing stocks to avoid the pain of realizing a loss.
Marketing and sales: Framing promotions around avoiding losses can be more effective than highlighting potential gains.
Public policy: Policymakers can use prospect theory to understand how people respond to incentives and risks.
Is it possible to be wrong and right at the same time???
My answer is Valid Yes..!
look at the following chart published 70 days ago
it moved in the opposite direction:
Now we can see why Claude Shannon said: “We know the past but cannot control it. We control the future but cannot know it.”
Rolled (IRA): TLT Jan 17th 2025 Short Calls to Feb 21st... for a .28 credit.
Comments: Rolling out the short call aspect of my covered calls (See Post Below) a month for a small credit. Cost basis/break even in the setup is now 90.20.
The small consolation prize is that this keeps my break even right around with the underlying is currently trading.
TLT for 15.04 big bear attack is comingFor TLT, I just wanted to share my own ideas, which are not investment advice, about the interaction of recent geopolitical events and expectations, as a note to history.
In the pre-trading hours, I expect 88.3 with the opening and maybe 86.9 with reaction sales. Since I foresee a movement around 1.045 in terms of Euro / Dollar parity, I suspect that there will be a serious withdrawal with possible reaction sales. In the meantime, I will make a loss as I am in a long position.
TLT Treasuries Long breaks down under VWAP SHORTTLT on a 120 minute chart has continued its trend down since early December after a suddent
uptrend in November lasting for a two month until the end of 2023.
Inflation data is kicking the rate cut down the road of time.
Price has now fallen under the VWAP and all of the EMA lines including the EMA20.
Relative strength trending correlates with price . I conclude, TLT continues to be set up
SHORT or alternatively TBT LONG . I will take short trades at weekly highs on a 30-60
minute chart until signs of a reversal are seen on the chart.
TLT- Are rate cuts postponed? LONGTLT has been in a broadening wedge and formed a falling wedge within the larger pattern.
Price bounced off the lower supoort trendline in the mid-morning of trading then rising
to break out of the falling wedge. I see this as an opportunity to take a long trade in TLT
and close out a TBT position at the same time. This reversal may be due to the value of
existing bonds with the implications of a rate cut postponed beyond June. The faster RSI line
has recovered to cross the 50 level lending further support to this long trade.