Trend Reversals

Treasury Bonds are currently have a strong chance of reversing their downward trend. Both the 20+ year Treasury Bond Index and the 7-10 year Treasury Bond Index entered into downward trends on September 16th, 2010 according to the model. Shortly after both started their downward trends. The model has recently signaled a high probablitly of these ending their downward trends.

The US Dollar futures Index, represented by the ETF UUP has already conformed to what the model is telling us. We are in a market climate that is heavily characterized by trend reversals. On 8/25/10 the model signaled a continuation in the down trend for UUP. On 10/20/10 we recieved a signal that the downtrend should come to an end. Around 11/8/10 the downward trend in the dollar came to an end and the dollar started to trend up.

The below chart indicates the date the model signaled a downtrend marked by the red line and then signaled the uptrend, marked by the green line.

The dollar should continue in its upward trend untill we recieve further signals indicating a reversal.
The below chart coincides with the price chart above for UUP. The model has signaled that the first part of the dollars move is complete. We are now waiting for the blue line to signal the move is fully exhausted. There is also a chance the red line indicator could move back to its upper range signaling the dollar will resume a downtrend. We are watching this carefully.

Strong chance of trend Reversal: Short Plays
USD: Dow Jones Semiconductor Index
USO: Crude Oil
EFA: MSCI EAFE Index
GLD: Gold Bullion