• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar

Investing With Options

Become a Better Options Trader

The Great Bond Selloff

March 15, 2012 By Steven Place

Equities were fairly quiet on Wednesday...

but the bond market saw significant selling across the board.

Many are focused on $TLT:

tlt daily stock chart

And I believe rightfully so. That was a multi-month top that completed the day before and saw followthrough on volume.

Keep it In Perspective

Some are saying that this is just a blip in the longer term picture.

And that's possible, if you have a 20-year timeframe.

Heck, even $AAPL could drop 20% but on a 20 year chart the trend would still be up.

It once again comes down to your signal sensitivity. For me, I can't think longer than a month out, so for traders this is news.

But it's not just $TLT. Check out $LQD:

 

The lower study measures the day's move relative to the 20 day historical volatility.

You can get the study here.

Yesterday's reading was -4.63. That means it was greater than a 4 standard deviation move to the downside.

Just a blip? Nope-- time to pay attention.

What This is Telling Me

Here's what I think-- in spite of this run in equities, there has been a "stubborn bid" in both safety products like treasuries and corporate bonds, as well as option premium as seen by the high premium in the VIX.

This week, it all gave way. Large selling in safety and protection.

It seems that we are finally entering the "acceptance" phase of the bull run we started in October.

Free Iron Condor Toolkit

Want to learn how to beat the market without needing to time the market?

Do you desire a way to earn aggressive returns without staring at screens for six hours a day?

Get this free iron condor toolkit that will show you how this trade works in the real world.

Download the Toolkit Here

Primary Sidebar

Resources


Option Trading Basics
Income Trading

Recent Posts

  • How I Profited From A One-Day Pullback In Tech Stocks
  • 3 Option Trades for CCIV
  • Time to Call a Top in Solar
  • Winning In Both Directions
  • Big Water, Small Hose

Get The Options Trading Training You Need.

See All IWO Trading Courses!

© 2017 InvestingWithOptions | Disclaimer | Financial Disclaimer | Terms and Conditions | Privacy Policy