TLT Weekly

The exchange traded fund that tracks the long dated U.S. treasury bond price is the TLT. The TLT now looks as if it has broken out of a bull flag. This would be a complete reversal of the prior break in prices.

All that is required is to surpass the previous high in treasury bond prices set in December of 2011.

Likely GBN.V shares will come under selling pressure, as the abolishing of the no-down-tick rule allows hedged or arbitraged positions to forgo marking a short sale. Thus any money involved in the selling of GBN.V stock without first owning any shares is parried against the rising trend in treasuries.

Treasuries options settle quarterly, so the next expiry date is in June. Futures markets for gold settle monthly on the precious metals options expiry date. For May this would mean the 22nd.

Possibly we will see a rally in GBN.V stock to the 300-day MA just prior to the June expiry if U.S. Treasuries continue to rally, as quarterly contracts are rolled over, regardless of the fundamental of the gold price.

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-F6