Exchange traded funds tracking long-term Treasuries are testing a key support level that if broken could lead to a move higher in yields. Inverse Treasury ETFs are one tool that institutional investors are using to hedge against a potential spike in long-term rates.

There are several ETFs that short Treasuries – they rise when bond prices fall. They include ProShares UltraShort 20+ Year Treasury (NYSEArca: TBT), ProShares UltraShort 7-10 Year Treasury (NYSEArca: PST), ProShares Short 20+ Year Treasury (NYSEArca: TBF) and Direxion Daily 30-Year Treasury Bear 3X (TMV). [Treasury ETFs on the Precipice]

Recently, a persistent theme in options markets has been bullish calling buying in TBT as options players are likely looking for higher yields – and a fall in bond prices – in longer dated Treasuries, says Paul Weisbruch, head of ETF/options sales and trading at Street One Financial. [Chart of the Day: Short ETFs for Treasuries]

There has also been put buying activity in iShares Barclays 20+ Year Treasury (NYSEArca: TLT), “which likely has the same motivation as the TBT call buyers,” he added. [ETFs That Short U.S. Treasury Bonds]

Still, Treasury bonds have been a great investment the past few years with the financial crisis, violent swings in the stock market and the Federal Reserve’s bond buying program. Yields are moving higher this week although the 10-year note had been stuck below 2% in early March.

“Bonds have achieved a near 50% total return since year-end 2009. With those outsized returns, shorting bonds has been a toxic strategy,” writes Doug Kass at The Street.