Leveraged Inverse U.S. Government Bond ETFs are suggested for tracking purposes since January 2024
Counterintuitively, the yield on the longest maturities (10-Y and 20-Y) has been going up (lowering the value of the bonds and supporting inverse ETF strategies) even though the Fed rate on short maturities has been falling
For bond investors, uncertainty can be channeled to resurgent inflation, out-of-control Federal deficits, hesitant foreign buyers of U.S. Treasuries
In the run-up to mid-term elections in November, US economic policy will most probably drive inflationary growth and deficits, with foreign buyers holding up for now (while booking heavy losses on the dollar exchange)
With a very large U.S. Treasury futures short position (close to 2 million contracts) and total ETF short interest in U.S. Treasuries of $12.4 billion, the risk of a short squeeze could be driven by strong U.S. Treasuries demand at current high yields (4.85% on 30-year bonds)
Undoubtedly supported by the U.S.Treasury Department…
Interesting times
To index 'uncertainty', a Gold ETF
By checking trends over different time frames from the menu at the top right, short term momentum can be tracked effectively
