Treasury yields have taken off in a big way. Check the 10-year treasury chart above. This action resembles when oil bottomed back in early February. Since then oil has soared. Treasury yields could follow the same path. Time to short some bonds.
The 14th marked a higher low for treasury yields and a change in trend. This recent move has also marked a higher low of the performance of the S&P versus the TLT (long dated bonds). This could signal that money is coming out of the safety of bonds and back into equities. People are becoming less risk averse which is bullish for stocks and bearish for bonds.
Couple that with the fact that there is a growing resistance to fed cuts because of rising inflationary pressures and you have a nice set up for lower treasury prices (higher yields) and higher stock prices.
Another chart that has caught my eye is the $BKX or the Banking Index. The chart below shows that the index successfully retested its lows and is now recovering a bit. It's a very positive sign that the banks are holding up even with all of the negative news coming out (Merrill writedowns, JPM raising capital, WB getting killed). Any breakdown to new lows would be concerning.
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