Long-term bonds outperforming tech?

Steven Mylonas Bottomcatcher.com

YTD the iShares 20 Year Treasury Bond (TLT) is up 21.55% (as of Aug 13, 2020), YTD the tech-heavy Nasdaq 100 is up 23.80%. During troubled times and low-interest rates, bond-buying would be considered a safer investment vehicle, and many seasoned traders hopped on board during the coronavirus pandemic, and are now sitting pretty.

TLT broke out of its multi-year rising channel (A) during the early part of March this year (B) as the broad markets began their decline. Could this breakout be the precursor for the start of an uptrend? Perhaps, what with a steady decline in interest rates and low U.S government yields, adding TLT to your portfolio might not be such a bad idea. Observe and monitor price behaviour at (1 & 2), if TLT manages to avoid falling back into the multi-year rising channel, it could indicate further buying pressure.

Author

Steven Mylonas

Bottomcatcher.com

With more than 20 years of experience, Steven has a broad knowledge of market strategies and the markets in general, with a strong focus and understanding of data reading.

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