Monday, June 28, 2010

TLT (Bonds) - Ascending Triangle Breakout

The bond market broke out of a picture perfect ascending triangle formation. It would have been added confirmation to see a large range day with expanding volume on the breakout but in any event, TLT has made a new closing high for the year .

Higher trending bond prices may put pressure on stocks so it will be important to watch this bond/stock relationship. As of today this relationship is suggesting higher bond and lower stock prices.

If TLT can post another close above the breakout point, I may consider buying TLT and exiting my long stock position which I bought last Thursday.  I think tomorrow (Tuesday) will be a very important day in determining the next move in the stock market.

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