10-Year T-Note Intraday Update: The Crash Continues

This 10-Year T-Note bear market has now been going on since the 2012 peak, and it’s still not finished, just yet. I believe that T-Notes have been in a zigzag crash in an Intermediate degree 4th wave crash. To compound wave counts even more, we have to deal with all the diagonal wave patterns that are always present.  The April peak was my diagonal 4th wave peak, which was followed by a decline that is not an impulse at all but must be counted like a diagonal.

The first zigzag looking crash looks like a zigzag, but I was trying to force it into an Impulse which never worked. Once I applied my standard diagonal count down, then things started to fit much better.  All sorts of zigzags show up with the first one looking near perfect, but these zigzags stretch beyond anything ever described in the EWP.  From the wave “2” top in Minuette degree.  The wave 3 followed which also only contained “one” zigzag, with the “B” wave riding high in the wave 3 counter rally, followed by a long declining “C” wave stretching wildly in the process.

The reason for an extra explanation, is that the markets are full of these types of extended “C5” waves, especially when we are in a 5th wave as well. This is only one type of diagonal decline and probably one of the easiest to count out. From late April to our present May peak is another diagonal 4th wave rally, which must be followed with another zigzag in Minuette degree. This should take T-Notes to new record lows, but then smash into a 4th wave bottom in Intermediate degree (Red) In the next couple of years we should see the bulls return as there are just too many people forecasting rates to climb further.

On Current COT reports it shows the commercials in one second  highest long position in over a year. This does not support a huge bear market in bonds, but rather supports a bullish phase to come. Most other types of bonds are also in net long positions, so it’s not just one contraian reading, as there are 3 or 4 other types of bonds as well.

All the bearish wave counts in the world will get trashed if we think that the “Big One” is here!   The last bullish 5th wave in Intermediate degree should also represent a zigzag rally, but this could be so choppy, we will be convinced it’s not a bull market at all.

This decline could last until the end of May and until this bottoms, upward pressure on rates will remain.

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