I’ve noticed that Oil price movement strongly negatively correlated with treasuries bills. Barrels of crude are down \~-20% from their high a few months back while TLT has rallied significantly(yields have fallen). In my head when thinking about liquidity, TLT rallying should be like a tsunami of liquidity and therefore a rising tide should make all ships rise. Weirdly however, crude has an inverse relationship. Is this because a rapid rally in treasuries signals weak economy needing rate cuts, which would signal lower future demand for oil?
