Bond Juggernaut About To Reverse:


The past week saw the long bond completing a Fibonacci 76.4% retrace.  Weekly volume has evaporated to –73%, compared to the week of March 13th.


As stated in a previous update, bond liquidity was removed long ago.  It’s great when the trend is up; no worries.


Problems (big problems) are likely when the trend reverses. 


Examples of these types of liquidity/volatility problems have already shown up in the leveraged DUST and JDST funds.  Essentially, liquidity and option bid/ask problems caused these funds to ‘blow up’.


Back to the bond chart:  It says a nascent bond reversal may now be upon us.  However, it’s early in the reversal (anything can happen) and price action is the final arbiter.


If the stock market heads significantly lower and the bond market moves lower as well, it’s the next step in wealth destruction for the ‘average’ investor. 


Market safe havens no longer exist just as ‘investing’ no longer exists.


With all of that, one gets the sense, IRA confiscation can’t be far away.  It nearly happened in 2008 – 2009.  This down-turn could be (it already is) much worse.


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Bonds Test


This session looks like TLT is testing its up-thrust.


It’s clear from the Force-Index (bottom of chart), the upward energy and bullish demand is essentially gone. 

  • First, comes sentiment
  • Then, comes volume 
  • Then, comes price

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Bonds Reverse


Price action is following the analysis; giving credence the 40-year bull market (in bonds) is over.


As shown, TLT has set up a huge trading range. 


If the move lower is impulsive (see Elliott Wave), the bottom of the current move will be to much lower levels; well below TLT, 139.



Bonds Before Open:


Pre-market activity in TLT shows trading slightly higher at +0.02-pts.


The weekly chart shows TLT extended at extreme levels.  Weekly up volume has contracted significantly and it appears we’re on the right side (declining side) of demand.


There could be a labored push to the 170 level to complete a Fibonacci 76.4% retrace. Price action itself will define this potential.





Long bonds, TLT spent the entire trading session getting up enough steam for a last-hour push into an up-thrust condition.


The pre-market update indicated one scenario as “… we get a push higher all the way to the close.”


That’s exactly what happened.


We’re probably splitting hairs if one wants to wait for a move to the 75.4% Fibonacci level at 170.  In addition, the previous measured move (wedge) target was 174.


However, price action itself has defined that an alternate wedge (on chart) may be in-effect.  If that’s the case, a measured move is near the 171 level.


Is it worth it to get the last forecasted drop out of a move?  Every single (professional) trader is looking at these levels as well.  We may get there or not.


We’ll see what happens on Monday the 30th.



Bond Spike


Pre-market activity shows the market may be on its next leg down.


Bonds are up

“Flight to quality”:  Right?


The tape says we’re in a terminating wedge; target in the vicinity of 174.


Changing the view on the Fibonacci timeline, counting the low (on 3/18) as day one, gives us a Fibonacci Day 8 at today’s session.


The market tends to alternate.  What happened last time won’t happen this time.  It’s not likely there will be an opening gap higher that immediately retraces as occurred March 9th.


More likely, is some kind of push higher throughout the day that reverses.  Or, we get a push higher all the way into the close.



Bonds, Day 13


Fibonacci Day 13, from the all time high was the last (Wednesday, 3/25) session. 


The market itself determines levels that are important.  On the chart we see an axis line that morphed into resistance.


Read more ...


Bonds Hit Channel


Ten minutes after the open and TLT is tapping up against the right side channel line.


Price action can go either way.  However, at this juncture, it’s quiet and risk (of a short position) is low.



Bond Channel


Here is one view (chart) of what's happening in the bond market.


While price action pushed through the stop level identified in the 3/23, update, bonds appear to be at another potential juncture.


This session will be Day 12, from the high set on March 9th.  There may be another attempt at new highs for the next two days to make it Fibonacci Day 13, or there may not be an obvious time correlation at this point.


Note that from the March 9th high to the low set on March 18th, was a Fibonacci 8-days.


12:08 p. m. EST


Bonds Retrace 62%


The hourly chart of TLT shows a Fibonacci 61.8% retrace.  There's potential for a significant reversal.


Risk (of a short position) is low at this point.


A reasonable stop on a short position (long TBT, TMV … not financial advice) would be in the proximity of TLT @ 163.79






Futures market overnight session and pre-market open, shows long bond (10-yr T-note) in up-thrust position.


This may be the ‘correction’ before bond prices head decisively lower.


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Update:  1:00 pm. EST


Trading halted (again):  See 3/16/20, update below.


Update:  11:01 a.m. EST


Decades-long bond bull market, is complete; Excellent article from H.L. Vogel.


Update (pre-market)


Watching bonds closely for continued down-side. 


The S&P is down over 6% in the pre-market.  Bonds are flat to lower (not a good sign for the bulls).




Bond Reversal


Probabilities of higher bond prices appear to be low at this juncture. 


An historic market crash, then 0%, interest rates, a pandemic 'scare' along with massive volume have not pushed bonds significantly higher; these are clues we may be at reversal levels.


If so, expect turbulence as TLT burns off late coming demand.


Whenever there is massive volume accompanied by a price spike, it’s typically a rotation out of strong hands to weak; the professionals leave the amateurs holding the bag.


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Bond Market:


Bond & Stocks Both Down?


Recall the Dodd-Frank bill passed in 2010, had the result of removing nearly all liquidity from the bond market.


Things are fine on the way up.  The way down … well, let’s see how that works out.


Inverse funds (not financial advice) for the long bond proxy TLT, are TBT (2X inverse) and TMV (3X inverse).


In the past five trading days, there have been at least three 'market halts'; Can't get in or out.


This is most likely the new norm on  go-forward basis.  




The Reversal


Website prognosticators have herded the unsuspecting and uninformed into gold and or gold stocks.  They say gold is going to $2,000/oz. or $5,000/oz. or even $50,000/oz. and beyond.


Here is an example, the visceral result of herd mentality.


Read more ... 



The Tape Says Gold


It’s before the market open and pre-market activity indicates the Junior Gold Miners (GDXJ) may be completing their counter-trend move.


Read more ... 



Junior Gold Miners About To Collapse?


Weekly chart on GDXJ shows the largest ever down-thrust energy.  The chart data used in the analysis goes all the way back to the week of August 13th, 2010.


The usual suspects, the YouTube prognosticators are pointing in one direction (up) while chart data, the tape, points in the opposite direction.


Read more ... 



GDX Price Action:


Forecast months in advance.


Two monthly charts are provided to show how they can prepare one to take action (confidently and) completely opposite of the herd.


Back at the beginning of August last year, was the forecast for continued upward corrective action in the senior gold miner index (ETF) GDX.


Along the way, there was help from the Wall St. Journal and other web prognosticators that gold was on a tear.  Forecasts for gold to reach $10,000 and $50,000 were resurrected, dusted off, and trotted out.


Fast forward seven months to now


Read more ... 



Crisis Management


The analysis and trade actions posted on this site are my response to current market conditions.


As stated in the ‘About’ section, I have over 22,000 hours of price action experience. 


Price action dictates market action


There's probably no point in recent history, where experience and proficiency in price action is more needed than now.

Three Ten Trading, LLC is structured as a long-short fund implementing proprietary trading strategies.  As such, we are not registered by the SEC, do not provide investment advice and do not engage in paid solicitation or advertising.  


This site is for the purpose of demonstrating the truth of market behavior; outlined by a market master: Richard D. Wyckoff in his text, Studies In Tape Reading, published 1910. 

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