The dreaded taper was supposed to kill stocks. It was supposed to cause bond prices to fall and interest rates to rise. It has done nothing of the sort. Magically both bonds and stocks are being bought these days.
The ETF $TLT is a great tool to track the trend of longer duration bonds. Right now it sits at a multi-year point of resistance. A break above could imply we are looking at lower interest rates down the road. Who woulda thunk it?
Seemingly everyone agrees that we are going to see higher interest rates down the road, as central banks unwind their extraordinary stimulus measures. What is $TLT telling us today?
I think the recent action is telling us the central banks have no intention of leaving the asset purchasing business anytime soon.
