Bonds

Big move in bonds today.
30-year T-bond yield TYX -  looks like a move to 41 supply point

10-year Treasury Note yield $TNX broke out of this down trend line and held a throwback to this trend line

5-year Treasury Note yield $FVX - more muted

TLT fell apart after testing the down trending 20-period SMA

INX (top) 30-yr (bottom)

So.  Yields up, attempting to advertise lower rates.  What does it all mean?

Bonds acting up

 Thought I would move this post (originally posted 8/13) back up to the top as it is relevant today.

TLT over $100 is significant and when it's there it seems to stay above $100 for a number of weeks as investors let things work themselves out in the markets before committing back into riskier assets.  Dropping yields can be a gauge of fear in the market; taking a look at previous times (and duration of those occurrences) the TLT has been over $100 compared with the SPY price behavior and major market moves.

A similar view using the 30-year Treasury yield with the S&P500

The gray shaded band (between $38.50 - $48) is basically the 'normal' variation range the 30-yr has been in post-2008, so it makes it easier to see the outlier events.  The $34.50 level represents a larger than normal 'fear' mood and trading below that level may give one reason to fade higher price moves in the S&P if price were behaving in such a way. 
However, what seems to be a common theme is that these outlier moves occur within a bottoming process.  Perhaps the fact that bonds and equities have a closer correlation on this recent sell-off is something we can key in on, something that can give us a confirmation/non-confirmation guidepost.

Here's a daily chart of the 30-year yield and the SPY; the correlation is close, but not perfect

As an aside, the Five year yield has made a new low and the Ten-year is coming close to new lows:

And finally there's the U.S.Dollar Index which just continues to coil throughout these past two weeks during a strong market sell-off.  Something to keep an eye on, in my opinion, as it may very well have a directional pull on equities.
Here's a look at a comparison of the Dollar Index to the S&P500

and on it's own, coiling beyond its down trend line

In short, keep an eye on bonds, especially the 30-year yield which appears to be highly correlated and the U.S. Dollar as it looks to be coiling for a move.  And remember, bottoms are always a process over time.

bonds up

TLT bullish Wolfe Wave shaken, not stirred:

from 07/31/2010:
TLT above $100 and looks to have just bounced out of the sweet spot of a bullish Wolfe WaveFound support at the 50-SMA (and a pitchfork mid-line) before gapping up to it's 20-MA (and the Upper Median Line).This weekly is somethin' else! Price coming back into the +$101 level could spell out some uncertain times for equities (read, volatility).

messy messy

{updated}
sooo close, the SPY v. Treasury cross-over has been put on hold.

How this week closes should set off an interesting turn of events in this market.
SPY First Cross Sell signal as a confirmed lower high may be in the works:Also the TLT (red line):SPY (blue line) correlation is getting close to a "Jaws of Death" crossover
from June, 30:

TLT and SPY

TLT closed on $100 today (highest close since April 2009).
A look at TLT vs. SPY (bottom chart).The last time this correlation crossed over was July 15, 2009 (crazy if it crosses the other way a year to the day!). A few days after this cross we got a breakout and higher highs on the S&P500:

The SPY closed right on its Lower Median Line:Wednesday is the last day of the month, how will that effect the markets until then?