The short-term oversold condition was somewhat ameliorated by Tuesday’s action but there is room for more upside before the short-term moves to neutral. This may be more a correction in time rather than price – i.e. the market may not go much lower here, but rather consolidate, with several false starts to wear us out before the next up leg starts. Much lower than 95 on the TLT would be yet another sign that this move is ending and rates are going higher. Should the UUP move above 21.45 this move would look stronger and this is what we expect.
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