Here We Go: Bonds Top

Support has been pierced, now we await follow through. The stock market has ignored this so far, but won't if this escalates.

The Nasdaq is still in the same downtrend. Attempted breakouts keep failing.

If the Federal Reserve wasn't involved, this would be a very uncertain trading environment because there are two forces working on bonds. One is safe haven buying from traders expecting an economic slowdown caused by rising rates, but rising rates also help dampen inflation, easing pressure on the Fed and the Nasdaq.

The fact that bonds have topped does not mean they will stay topped, but will provide some fresh salmon for the bears. The completed topping pattern in 2018 was going great until Powell panicked. If yields rise, stocks are going down.

The final piece of the puzzle is the Federal Reserve. The dumbasses at the central bank haven't started tapering yet! My operating theory is a win-win situation for bears. Yields will rise as the Fed stops buying bonds or, if capital flows into bonds, it will have to come from somewhere else: the stock market.

Crude oil remains a pivotal asset. It should experience a sharp correction if bonds break down because the "higher rates, lower inflation" narrative should surge. If this is a repeat of the past decade-plus, then crude should collapse in the coming weeks. If instead the Greens and ruling class are in the process of winning a Darwin Award, crude oil will not decline. Bonds will have topped for good. Terror and slaughter will triumphantly return.