The "Death Cross" will be back in the news soon if stocks have many more days like yesterday (that's when the 50-day moving average falls below the 200-day moving average and is seen as a sign that more of the same movement is to come).  While that hasn't happened for stock markets recently, it has happened for bonds!  Well, actually, it's happened for bonds in a different way. 

If we end the day without a horrible selling spree, the 50 WEEK moving average will have crossed below the 200 week moving average for the first time since 2008.  But wait... haven't bonds rallied in general since 2008?  Why would the short term average be crossing below the long term average?

Easy.  because it had crossed above the long term average due to the taper tantrum!  The 50 week average has been higher than the 200 week ever since.  It turns out, if we put this on a chart, we can see that every single break below the 200 week average happened in a similar way.  Bonds had been rallying.  They pulled back up for a year or two, and then resumed the decades-long rally. 

Does this mean a big old rally is imminent?  Not really. 

The trick about this chart is that bonds have rallied for 30yrs.  These sorts of technical anomalies are normal byproducts of such long term moves.  The real question is whether history repeats itself.  Obviously, folks asked these same questions in the past (for instance, 2003's low yields were widely regarded as a generational low at the time.  Woops!), but every time it comes back up, the folks paying the closest attention tend to think "this time is different."  

This time definitely could be different!  I've thought that many times since 2012.  We had an uncommonly bad shock to the system in an uncommonly interconnected global economy with an utterly unprecedented response on the part of governments and central banks.  Surely, if there is a good candidate for a long term rate low, mid-2012 is it!

Then again, maybe the world is just getting bigger.  Maybe what seemed like a great candidate for a long term low in 2003 was just a product of a younger, more limited worldview.   

The point is, no one ever knows what's going to happen in the future when it comes to financial markets.  If you've been feeling like there's no question that rates will move higher in 2015, maybe consider that they could.  If you've been watching the recent rally and concluding that we're heading back to record low rates and the global economy is screwed, maybe consider it could just be a correction in a trend toward higher rates.  Either way, don't get too caught up running with the popular crowd.  Markets have a tendency to make fools of them.