Interest rates bottom, TBF moves higher

Look at this chart. It shows the ProShares Short 20+ Year Treasury ETF (NYSE: TBF). As an inverse fund, TBF goes higher when interest rates go higher and bond prices go lower.

You can see how TBF (and interest rates) created a V-shaped bottom last October.

Soon after, the Relative Strength Index (RSI) began showing bullish divergence – a signal for higher interest rates (and TBF prices).

As TBF traded sideways it seemed $31 was holding as support. We alerted Boom & Bust subscribers of this bottoming behavior and recommended moving stop loss orders to $30.50.

This move reduced our risk, but also gave time and room for TBF to go higher… which is what we’re seeing now.