Let's try something a little different for the weekend...  No novel tonight.  Lock/Float considerations were well discussed earlier in the day.  But when we move like we did today, I get the urge to psychoanalyze the charts.  So here's a tale of 9 charts, about which I'll say little if anything other than what's already been written on the them.  Use the comments section to discuss what sticks out to you and we'll revisit these long term trends next week.

But first, price action over the last 2 days at least deserves it's own chart!

So, we see bonds seemingly tail off with no particular "mission" evident, but when we zoom out to a monthly view, we see the first argument against the "random walk" lower in yield

So not only are MBS (in green) and Tsy's (yellow) encountering resistance at their best levels of the month, but SOMETHING appears to be going on with stocks as well.  But to find out, we're gonna have to take you back... WAY back, to a little year I like to call 2009.  What?  Oh, everyone calls it that?  Oh well, nevermind, just look at the chart. (remember, you can click anywhere on the chart to expand the view!)

It's a busy chart, but just take it piece by piece.  Even before the time frame pictured, recall that stocks had already been on a mind-numbingly linear uptrend, characterized by strict adherence to technical trendlines and wave patterns.  So when year end came, it was hard to say if it was a consolidation of those gains, a reversal, a pause and regroup for 2010, or just general indecision.  It LOOKED LIKE we got our answer as stocks broke the exceedingly long range it had been in.  It even made a convincing bounce off the inflectional support derived by it's Dec. highs.  But over the course of this week, it not only moved back into that range, but FELL THROUGH!

WE HAVEN'T SEEN THE "FREIGHT TRAIN" SHOW THESE SORTS OF SIGNS OF WEAKNESS SINCE BEFORE THE MARCH LOWS!

But does that mean that stocks are "oversold" and due a rally?  Or is it a sign of things to come? 

If you're looking to the bond markets to inform that question, you may be looking a long time. 

Ok ok ok.... So MBS are on a fence dividing the higher trading of the fall and early winter from everything else.  What about Tsy's?

Yes, the testing of 3.62 inflection is nice and all, but it's not sustained, so no conclusions can be drawn from two non-adjacent closes under that level.  More proof please!   But even then, it's not 3.62 that defines the recent epoch, but rather 3.56!

Bottom line, If the 10yr isn't under 3.56, all this beautiful drama that's seemingly favoring bonds could just be a movement to the 2010 range boundary.  Because if the 10yr isn't under 3.56, It's just not a "second half of 2009" kind of yield.  But so close though!  Close enough to utterly and completely reinforce the "on the fence" metaphor.  What else did you expect?