BND bounced off a critical support corresponding to November 29th, 2007, the day that yields spiked after BND dropped and miraculously regained 7.5%. We see a downward trend forming in BND indicating a tendency toward rising rates while debts and deficits continue to set record highs. If the FED is not willing to significantly debase the dollar through record levels of monetary injection, the bond market will continue to drop. We are in the danger zone here, watching the bond market is crucial to timing the coming drop.
I do not suggest going short until the following conditions are met:
1. Bond market drops considerably over any time frame (testing that critical level of pre-2008 crash or extreme velocity).
2. Stock market begins to face reality - depends on the velocity of rising rates (faster = sooner).
I do not suggest going short until the following conditions are met:
1. Bond market drops considerably over any time frame (testing that critical level of pre-2008 crash or extreme velocity).
2. Stock market begins to face reality - depends on the velocity of rising rates (faster = sooner).