24 February 2017 – Bonds Reverse? Gold is up.

My prediction worked out right for oil and especially gas. Gold rallied by 1.5% during the week and I made back my losses in oil and gained more as well. However, my short in US long-term bonds are costing me right now. Yields have fallen on the fear of rising US stocks. I bought and sold gold and oil futures during the week which gained a profit for the week. Now, I will be jumping again the next week depending on the mood of the market. So, I will wait to watch out.  
Now, It seems to me, market participants are having their rising appetite for Bonds against stocks which I had not taken into account before.  10 Year Treasure notes have fallen to 2.317 % Friday lowest since November. The shift was selling bonds and investing in stocks now trend might move another way around. On the other hand, Fed rate rise gives an opposite signal. I will need some more time to understand what course of action to take on bonds. I might abandon my trade on bonds for now as uncertainty settles. Right now, my action is short in bonds based on Fed rate hike view which may not come within the next month and be postponed until May.
bn-sg171_201702_e_20170224182727 bn-sg173_201702_c_20170224183209
Lower yields in other developed countries, crisis in Europe ( political) are making investors fleeing back to Treasuries. However, I am not fully convinced. I will be waiting where the prices are gonna be the next week before I decide to cover.
 I could not spend more time focusing on currencies, therefore, did not take any position during the week. As I am busy these days, It prevents me to focus fully on the portfolio.
I reduced my stock positions during the week on the anticipation of stocks might correct themselves. I will wait for Monday futures trading to see where the index is going for now.
Trump will speak next week to the Congress. I will see what he is going to say about the economy.
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s