As I noted late in the session on Friday, I called an audible and stepped out of my bond shorts, most of which I had been holding since August 29th.
In determining where and when to reenter, I am watching the $115-$116 level, just above, on the TLT ETF for Treasuries.
The bounce today is not particularly strong, though Friday saw a rally which finally held, which was enough to see me stepping aside for now.
TBT TMV are still my preferred instruments of choice.
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The only thing that gives me pause about getting in on the bond short is if equities correct, you’d expect money to flood to bonds. I just have a hard time wrapping my head around both Bonds and Equities declining significantly at once. But I guess it is still possible.
My thesis is they will move in unison this cycle.
If $SPX breaks down below 1991 then the extended rally is invalidated and the correction begins in earnest. If 1991 holds then we rally to new highs shortly.
Agreed