The divergence between stocks and bonds is the key. Stocks can't hold at present level if interest rates, as measured by the 10 years treasury, continue their path to higher grounds. On a short term basis my target is 2.49, which would completely erase the preceding 5th. A bad CPI number (out tomorrow before opening) could certainly do the trick.
More on the TNX long term view later. Stay tuned and happy trading.
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This chart (from 1994 to the present) gives only a partial idea of the problem... The channel goes back to 1982 ! If the TNX goes above the upper line, it will utterly kill the secular bull markets (stocks and bonds). The magic number is around 3.35, and falling. We probably won't see it this year (2016), but next year ?