In the beginning of 2014 we saw a big shift with investing. Investors bought both US stocks and US bonds. This trend lasted up until September of 2014, about same time oil started to break down and stocks became very volatile. Also during September we saw a big shift to US bonds. As the market gyrated with oil volatility - OVX - US bonds grew even stronger.
However, today I saw what looks like a turnaround in this trend since September. As oil went up, stocks went up and bonds went down by a significant amount. This is important event, because it signifies were in an early stage of another risk on move, meaning investors will once again take more risk in the equity markets rather than bonds. So I will be looking for a top in TLT. Stocks may still get a bit more gyration with oil, but we should be looking to buy dips.
Note: You can also read up on my related Stage 4 to Stage 5 of Intermarket Analysis, which previews a reasoning for when to take bets in Financials. In this case your best bets might be with European Banks.
However, today I saw what looks like a turnaround in this trend since September. As oil went up, stocks went up and bonds went down by a significant amount. This is important event, because it signifies were in an early stage of another risk on move, meaning investors will once again take more risk in the equity markets rather than bonds. So I will be looking for a top in TLT. Stocks may still get a bit more gyration with oil, but we should be looking to buy dips.
Note: You can also read up on my related Stage 4 to Stage 5 of Intermarket Analysis, which previews a reasoning for when to take bets in Financials. In this case your best bets might be with European Banks.
