BOND (ETF) Argues for Higher Longer-Term Rates Ahead

Bill Gross and PIMCO Total Return ETF (BOND) offers us another perspective on the U.S. Treasury market, and the direction of interest rates.

In late April of last year, when BOND turned down, and then triggered a sell signal in the 109.80/60 area, 10-year YIELD initiated a climb from 1.61% to 3.00%.

In that the decline in BOND from 111.10 to 103.04 exhibited very bearish form, and in that the entire subsequent rally phase from 103.14 to last Thursday’s high at 109.00, exhibits counter-trend form, my pattern and my momentum work are warning me that another downleg-- a continuation of the "bearish period" from 2013 --is approaching.

This then should send BOND considerably lower—towards 106.00, on the way to revisit 103.00.