According to this article it seems we might be in for a bear market for bonds going forward.
Another opportunity to get short in bonds is upon us. Using technical analysis, it appears that the run up in bonds last December was the head of a giant head-and-shoulders top on the weekly charts. I wouldn't advise anyone to short bond weakness but instead to short failed rallies into resistance. Bonds don’t end their seasonally strongest period until late November, and there seem to be plenty of eager buyers around at auction time. In spite of this fact, I do expect bonds to complete this huge head-and-shoulders top between now and Thanksgiving. The long secular bull market in bonds ended in December 2008 and a new secular bear market in bonds has only just begun.
The article says the go to stock to catch this move downward is the UltraShort 20+ Year Treasury ProShares (TBT) I think I'll reduce my bond exposure going forward since Minyanville tipped me off of the warning signs that led to the Lehman collapse.
Another interesting side not in a sell-off in the bond market is that it will put a crimp on any further insane spending by the White House. So "Failed-Stimulus 2 - Pelosi's Revenge" will not be in the offing anytime soon.
In any case, I have read multiple sources saying that the market is getting ahead of itself and might sell off soon. The severity of the sell off is different with each commentator though so you can't really be sure. I think it is time perhaps to be whittling down positions to get back into cash again.
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