Rates vs. Equities

TLT original chart from mid-Feb


updated


spx daily....look at mid-Sep for your reference fractal--this is easy when the fed/paulson and borrowing ibanks are all working together

Those charts are tough to read, it would be better if i had an overlay or something... how about making your point in plain english? Thanks. Other than that they are divergent, not sure what point you are making... Thanks. I guess you are presenting the bullish case after getting my magnifying glass out to try and read some of the detail here. I guess you are implying that we should rally into May like we did into November based on some kind of fractal... Is that it?

Edited by SemiBizz, 10 April 2008 - 06:32 PM.

Funny, I thought he was showing via the first two charts that the high/low thing has been accurate and that we hit a high today and should now head towards another low on May 7th. The third chart says that low is slightly below 1288.

I guess you are presenting the bullish case after getting my magnifying glass out to try and read some of the detail here. I guess you are implying that we should rally into May like we did into November based on some kind of fractal...

Is that it?

SB, in a nutshell....yes.

For TLT, why I read the chart as bearish, implying higher rates:
1) change-in-trend, near the original price/time target was due todayish
2) we closed below the 75% parallel on a pretty nasty intraday reversal. Until it can break back above, I'll consider it resistance.
not on the chart, I have not measured to what degree, but equities and bonds have been inversely correlated in recent months (classic bear behavior). If the relationship continues and the chartwork is ~ accurate, equities will rally into the next CIT date.

For SPX, here's a modified chart (moved the fib times) hosted at a different site, hopefully more readable.



1) Like the Aug07-Oct07 rally, we met resistance at the 75% parallel and pulled back for several days.
2) timewise, the pullback for the 07 rally terminated right after the 50% fib time bar. for the current rally, we just passed the 50% fib bar....and coincidental or not found support almost exactly at the 50% fib level of the projected range targeting 1431ish.
3) in both cases, we are rallying at roughly the same speed/angle.
4) the bars are colored to match moon phases......the 07 pause occurred during a green moon phase. the current pause......the same.

Not included here....though ideally we see a 2.5wk low next week, my 30min momo work triggered a buy signal today. In strong markets, momentum trumphs cycles (i.e. the dip-buying bulls won't wait).

We are heading to 1431 around the next jobs report.....that's my FF.

I think that's nice work. FWIW, I saw what you were getting at. I have some fear that the rally may truncate due to a looming Sell signal, but that remains to be seen. So far, it looks like you've got a pretty good scenario. Mark