The U.S. bond market, represented below by the TLT fund, continues to break down. It is getting close to support, and this Friday morning’s jobs report will probably be the catalyst to either start the plunge or deny the pattern’s completion.
This is a pattern-within-a-pattern. The vastly larger pattern, spanning years, is a long way from completing, but if it ever does so, you can forget about reasonable interest rates for a long time.
If you look at the charts of interest rates, the shorter-term they are, the lower they are going. The yields on 6-month instruments are plunging whereas the yield for long-term treasuries has completely defied history and is pushing higher.
I am long June $90 TLT puts.
