The drop in bonds took them down the 76 retracement level and this is where we're stalled out, at least for now.
Action in this area is consistent with a head and shoulders - and if that pattern is in play then we'd be into the rally in bonds now.
Something that's always worth noticing is when there's a lot of talk of something dramatic happening in something but it doesn't make a new extreme.
During the last drop in bonds there was extreme bear sentiment (It's not even something I'm all that interested in and I was seeing it everywhere) but this drop has so far failed to break the low and, perhaps critically, remains above the 76. Currently in the pending reversal zone we have the formation of a possible reversal pattern.
This is a premise we can invert to the yields also.
If these reversals play out, they predict that these start to change really quickly. We'd be heading out of the late reversal stages and into the early trend.
We'd expect to see bonds sharp up and yields sharp down.
Failure of these levels as reversals would imply a far stronger trend in these, but I do think the odds skew better towards reversals here as per the TA norms.
Action in this area is consistent with a head and shoulders - and if that pattern is in play then we'd be into the rally in bonds now.
Something that's always worth noticing is when there's a lot of talk of something dramatic happening in something but it doesn't make a new extreme.
During the last drop in bonds there was extreme bear sentiment (It's not even something I'm all that interested in and I was seeing it everywhere) but this drop has so far failed to break the low and, perhaps critically, remains above the 76. Currently in the pending reversal zone we have the formation of a possible reversal pattern.
This is a premise we can invert to the yields also.
If these reversals play out, they predict that these start to change really quickly. We'd be heading out of the late reversal stages and into the early trend.
We'd expect to see bonds sharp up and yields sharp down.
Failure of these levels as reversals would imply a far stronger trend in these, but I do think the odds skew better towards reversals here as per the TA norms.
Note
For the bears here the obvious sell point is here;And you'd be looking for a new low.
Which has not happened yet. It's too early to tell if it will, but we can be fairly sure if this is an inverted head and shoulders there would next be a big pop and breaking of the bear zone. Likely a retesting of it and then the reversal.
Note
In a bigger correction inside a bear move, we'd typically have a max correction as a big butterfly pattern. If we pop from here and get to there, then this is where the big trend decision is made. Classic butterfly reversal would have that as the high and then a downtrend to follow. Failure of the butterfly continuation is one of the first major signs of a trend break,
All things considered, I think this looks a lot more like one of the setups where the butterfly may produce a short term dip but ultimately break.
Note
Popular wisdom has it lower rates=higher markets, but that's historically not what has happened. I wrote a post recently explaining the real tendencies of this. 
We may be inside of a crash event to 3000 in SPX.
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
We may be inside of a crash event to 3000 in SPX.
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.