Monday, June 24, 2013

Killing the Bonds

I have never seen anything like this in the bond market.  I have never seen a bond market rate spike while equities are going lower with commodities weak.  This is clearly not an economic move, but a move based mostly on fear and liquidation.  These type of moves do not last for long.

The fundamentals of the bond market are excellent, you have central bank buying and an economy that is too weak to bear higher rates.  Bonds are in a bull market, and it should last longer than the equities bull market.

I expect capitulation within 3 trading days, with buy levels on the ES around 1550.  I am waiting to buy, I don't believe it is worth it to short at this point in time, it is getting late in the pullback.

No comments: