Not much of a bounce.  Bonds looking interesting.

Yesterday ended up being a lame dead cat bounce when the door was open for an oversold reversal.  And that was during a day where oil fell $3 a barrel.  Not very impressive. 

Perhaps the market will chop around for a few days before it decides which direction to go but we have become accustomed to getting a little more of a bounce the day following a 120 point drop in the Dow.  This could be a sign of a longer term decline but it still too soon to call. 

Of course my indicators have been expecting a longer term decline but we know better than to hold our breath based on them.  I do feel better being on the sideline but I know some of you are getting antsy being idle in the G fund.

If you are bored of the G fund but still want to be on the safe side, there may be a short term window to give the bond fund a shot.  Looking at the chart of the 30-Year bond price, and the yield (below) it seems to be a shaping up into a purely technical short term play.



                         Chart provided courtesy of www.decisionpoint.com

Bond prices move in the opposite direction of bond yields.  Yields are still in a downtrend and are coming off a short term rally.  The bond prices were supported by the 200-day moving average during a recent pullback, and the bond yields found resistance at the 200-day moving average.  If the trend continues we could see a little rally in the F fund. 

As I mentioned above, oil dropped nearly $3 a barrel yesterday.  Looking at the chart it could see some support between $61 and $62.  Last year oil sold off in late August but rallied strongly in September after Labor Day. 


                         Chart provided courtesy of www.decisionpoint.com

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That's all for today.  Currently 100% G fund.  Look for an email alert today if bonds don't jump too much in the morning.  I may be moving into the F fund before the deadline.  Thanks for reading.