logo-light

Higher Inflation and Lower Bond Yields… WTF

Hey There Income Hunters,

 

I want to send out a special thanks to everyone that joined the Digital Currency Arms Race Live event yesterday.

 

The stocks we discussed had a big day yesterday. Those were …

 

        • Boss Energy (Ticker: BQSSF) +10%
        • Denison Mines (Ticker: DNN) +6.8%
        • Sandstorm Gold (Ticker: SAND) +4.5% 
        • The VanEck Vectors Gold Miners (Ticker: GDX) +2.5%

But somehow so did iShares 20 Plus Year Treasury Bond ETF (Ticker: TLT)

 

What gives?

 

A consumer price index (CPI) print of 5% — the most since 2008 — yesterday should have sent shivers through the spines of bond traders …

 

But you wouldn’t know that looking at the TLT chart:

 

Happy days when stocks, bonds, commodities and precious metals all rally… 

The bond trade was very crowded, and sometimes that is enough.

I think the most interesting news to come will be how much gold China actually owns — because the biggest trade of the decade will be gold backing digital currencies … and it is coming.

Going for GLD

Now I’m looking at an option spread trade on SPDR Gold Trust (Ticker: GLD) to also consider for July.

GLD looks strong. During this rally it has held against the 20-day moving average with just one pullback.

Then yesterday it had a really nice high volume day up.

I think it is setting up for a nice breakout. This is a great setup for a call spread just above the recent high into July…

A 180-185 call spread offers a nice 4.5-to-1 risk/reward ratio and only costs $1.1.

We expect the market to rally into the June 28 deadline for paper gold trading desks to unwind their positions which is currently a net short of $40 billion.

That could easily push GLD above the 185 level with it set-up so bullishly … 

Bring It Home

Just wanted to throw out one more bonus trade for the #Income Hunter crowd… I think we are in for one one heck of a ride in the next few weeks.

Enjoy it and have a great today…

Live and Trade With Passion My Friends,

Griff

Leave a comment

Your email address will not be published. Required fields are marked *