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Wednesday, March 13, 2013


TLT may be forming a bottom here.  Lets start with the weekly chart.

TLT tested its weekly 100 SMA last week.  It is trying to rebound this week.  TLT has been in a down trend since it formed a double top between June and July last year.  It could be forming a double bottom here at the 100 SMA.  Lets zoom in to the daily chart.

TLT spiked down on 2/1 on high volume.  It then traded sideways for several weeks which included a high volume up day.  It then broke down to new lows on Friday on another high volume day.  That had the bond bears out proclaiming a big down move in bonds.  Funny thing happened though.  TLT started going up again this week.  Today it climbed back above the Feb. low on an increase in volume.  That last move down looks like a stop running exercise to me.  Now that all the weak longs that bought in during the trading range have been flushed out it looks like TLT may be ready for a move up.  Stocks saw a nice rally while TLT was going down.  A rotation back into bonds from stocks could be in the cards.  That would go along with the chart I showed in A few interesting charts indicating we could be starting a global risk off phase.  Will bond bears be thwarted again?  I think this is an important juncture for bonds and probably stocks.  What will TLT do from here?


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