Tonight I wanted to take a look at the relationship of bonds & equities and bonds & gold.

tlt spx

Since about mid-September bonds and equities traded inversely to each other…

tlt gld

While bonds and gold followed each other more closely.

And as we can see that stocks have been rallying while bonds & gold have been caught in the grip of an intermediate cycle decline.


The daily bond cycle peaked on day 6 and printed its lowest point last Tuesday, day 17. Bonds printed a swing low on Friday and delivered some bullish follow through today. The break of the declining trend line signals a new bond cycle.

And if the relationships that we observed continues to hold, then we can expect weakness in stocks as gold begins to rally.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s