T BOND FOLLOW UP

Here is a prime example of what I spoke about the other day regarding indicator divergences. I have mentioned the negative divergence that had developed in bonds between insider buying and the price. I had also said that these can carry on for awhile, and were not a trigger by themselves.

Notice how the bond market has continued to rally in spite of this divergence. I have seen this happen many times during trend runs like this. Make no mistake, on a "short term basis," this market has a strong uptrend going. All these types of things are is tools to give you a general direction of what to look for next.

It it tough to go with markets, against the direction of the divergence. At times this is exactly what one must do. I do have a short position on that is based on a bar pattern. It needs to be stated, that it was not put on because of this divergence. It was based on entirely different parameters. These divergences are not programmable, they are just things you can see and observe.