US Bonds Midday

US bonds, TLT, have already breached the swing low on pretty decent volume just after midday. Ignore the headline spin on bonds and equities, a breach of this low, which is also the straight line neckline from June 2009 is no small matter.

Last weeks COT data (10- and 30-year) illustrated big inflows to protect this zone. If this line in the sand cannot hold, a new lower line will be conceded and the neckline will have failed. The market's reaction to an identifiable technical top could be difficult for even the spinsters to contain.

With that said, I expect this zone to be heavily defended as the technical implication of a break are huge. Failure at critical support despite intensified efforts will reveal the severity of the technical damage. A point that will not be missed by the trading sharks that will show no mercy.

US Long Bonds ETF (TLT)