In my last post on $TLT (here), I expected a low to be forming because of the wave balance that was present at the low that was formed in June. Ironically, and to my great embarrassment, that post marked the top of the rally, and we have since had another decline. So let’s look again.
That wave balance was so perfect, that it was strong evidence, but it was predicated on the start of the whole yellow a-b-c count having its origin at the top of the COVID crash peak (which I’ve marked with an orange box in the chart below).
Looking at it this way, with an alternative high, makes it almost impossible for me to not see the structure as now complete. It’s clearly a large 3-wave decline, and it counts internally well in the course of the yellow “c.” And, while there are great fibs within yellow “c,” there is not a relationship between yellow “a” and yellow “c” if we use the COVID spike as the origin of yellow “a” which i had tried to use before.
However, by using the August of 2020 high as the origin, there is now wave balance between the yellow “a” and “c” waves, and that all coincides with balance between the pink waves that make up yellow “c,” too. And so this is a terrific spot for bonds to have finally bottomed.
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