QUICK SPARK: The TLT ETF Tracking Long Duration Bonds Hits New Record Low

The iShares 20+ iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) fell to a new record low of $79.71 on Thursday as long-duration U.S. Treasury bonds sold off.

10-Year Yield Hits 5.11% as Bonds Slide

In a Thursday note, market analyst Ed Yardeni said the 10-year Treasury yield climbed to 5.11%, its highest level since 2007. Yardeni tied the move to a booming U.S. economy growing faster than expected.

He pointed to strong data, including the U.S. Composite PMI at 58.4, which he said is feeding the bond sell-off. Yardeni said real yields, rather than inflation fears, are driving the rise.

Yardeni Sees Confidence, Schiff Sees 6%

Last week, Yardeni called 10-year yields at 5% a “vote of confidence” in the economy and said growth can sustain higher borrowing costs.

Investor Peter Schiff warned the level could be a “launching pad” to 6% and beyond. Schiff’s view adds to the uncertainty ahead of the Federal Reserve’s next interest rate decision as Wall Street remains split on what higher yields mean.

Technical Analysis

The iShares 20+ Year Treasury Bond ETF closed at $79.75, with an RSI(14) of 33.65, indicating a neutral signal. TLT trades 3.15% below its 50-day SMA of $82.35 and 6.96% below its 200-day SMA of $85.72. The 50-day SMA is currently below the 200-day SMA.

Image: Shutterstock