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Amateur Investors Weekend Market Analysis (2/5/11)

http://www.amateur-investor.net/Weekend_Market_Analysis_Feb_5_11.htm

For those watching Bonds the 10 Year has been in a long term downward trend going back to the peak in the early 1980's. Meanwhile since the late 1980's the 10 Year has been in a downward channel (black lines) while making a series of lower Lows (L) and lower Highs (H).



Meanwhile it doesn't take a rocket scientist to figure out the long term downward trend in the yields helped ignite the Bull Market from the early 1980's through the late 1990's (points A to B). Of course the big question is will the long term trend in the 10 Year Bond Yields continue lower and remain contained within their downward channel or will they eventually break out of their downward channel and undergo a substantial rise like occurred in the 1970's? As you can see the rising yields in the 1970's (points C to D) had an adverse affect on the market as it traded nearly sideways for several years while undergoing a consolidation period.