Direxion Daily 20-Yr Price, Forecast, Insider, Ratings, Fundamentals & Signals

Rising Treasury yields continue to push the prospect of rate cuts farther out into the year. However, a recent pullback might be an early sign that Treasuries could be rising, which should clear the pathway for bullish opportunities in leveraged exchange-traded funds (ETFs).

The capital markets have been hanging on the U.S. Federal Reserve's every word, looking for any indication of rate cuts. But as the higher-for-longer narrative continues to go on, stubborn inflation and elevated yields could keep bond bulls at bay.

Using The 4x SPX Fund XXXX To Build A 'Smart' Portfolio

With capital markets eyeing the close of the first quarter of 2024, there's much optimism heading through the rest of the year in anticipation of interest rate cuts. This should bring the bulls out who are looking to play a run-up in bond prices.

Interest rate volatility remains high, impacting Treasury yields and creating daily fluctuations in the long bond market. The conditions favor avoiding leveraged Treasury funds, such as the Direxion Daily 20+ Year Treasury Bull 3X Shares ETF due to negative compounding returns. A hot January CPI report but cool January Retail Sales report further assert balanced macro risks.

It generally takes a few years for changes in Federal Reserve rates to fully impact bond fund dividends. Bond funds are still benefitting from prior rate hikes. Perhaps by enough to cancel out any future rate cuts. By my estimations, and under current Fed guidance, most bond funds would only start to see declining dividends in 2025, at the earliest.

JD Henning discusses his approach to the market and emphasizes the importance of timing and using momentum gauges to avoid major market downturns. Investing vs trading portfolios.

Banks are relatively firm on the expectation that interest rates will fall in 2024, giving the bond market plenty of optimism heading into the new year.

TMF is a leveraged ETF seeking 300% of the daily performance of the ICE U.S. Treasury 20+ Year Bond Index, providing investors with amplified exposure to long-term rates. TMF can be used as an efficient capital allocation tool, allowing investors to gain exposure to long rates with a smaller initial investment compared to TLT. Caution is advised when using TMF due to daily rebalancing and beta slippage, which may cause its performance to deviate from precisely 3 times the performance of TLT over extended.

Interest rates have been rising and yields have followed the same path. So traders bullish on bonds have essentially been seeing a repeat of 2022's weakness.