Category Archives: ETFs

High Yield Bonds

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The largest mass shooting in US history, and naturally equities are at lifetime highs again. Incredible. Anyway, one chart that remains interesting is that of high-yield corporate bonds, which remains mashed up at the top of a very long-term channel. I recognize that a dividend was issued, and that partly explains today’s weakness, but the downturn from a few weeks ago is more substantial than the dividend. I’ve provided a detailed view of recent activity.

1002-EMB

TBT Advance Gains Momentum

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As we noted in our article last week, we have had strong reasons technically as well as from a macro perspective to be bullish on the ProShares UltraShort 20+ Year Treasury (TBT) since its low just under 33 on September 7.

And the TBT has continued to rise since then.  It gapped up Wednesday to $35.50 from Tuesday evening’s close at $34.46.

The upward thrust occurred just in advance of the unveiling of the President’s Tax Reform Plan (Wednesday at 3 PM ET), so we have to couch its bullish action under that umbrella.  But with lower taxes for most individuals and businesses and a one-time business foreign repatriation tax-break being reasons to anticipate an increase in spending, infrastructure, and investment, higher interest rates likely will be a bi-product of such a policy mix — if tax reform becomes law. (more…)