S2 Option Trader

[plashadpobedy]

SPY vs. TLT (20 YR TREASURY) & their 50dmas

I've been following this poster on the yahoo SPY board and what he says makes a lot of sense. You can see it in the charts (links below).

Here's a paste of what I pasted on the yahoo USO board:

"A poster on the SPY board pointed out the inverse relationship between the SPY & TLT (20yr treasury), in particular, their 50dmas.

It would appear that TLT & SPY are diametrically opposed and the 50dma of each is highly significant.

In May of 2010, TLT's 50dma turned north and headed up until late August of 2010 (it's top).

TLT 2010: http://stockcharts.com/h-sc/ui?s=TLT&p=D...

SPY 2010: http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=1&mn=0&dy=0&id=p69566991270

At TLT's top (end of Aug 2010), the SPY started to head up after crossing it's 50dma. About 5 weeks later, about the 1st week of Oct 2010, TLT broke south of it's 50dma and headed down, as SPY headed up.

Per this "bearish" poster, we are at the crossroads now. He's previously pointed out the rollover into bonds and the movement out of stocks (which has been going on since early April).

Here's a paste of his post:

Re: you can tell who trades 1-Jun-11 07:54 pm

It's just the 50 with a comparison to the 50 on the TLT.

When a certain pattern hits the 2 you go short the SPY when you get the opposite, you go long the SPY pro's use it all the time it never fails but takes great patients.

Only about 3 signals per year. Takes guts to pull the trigger.

Sentiment : Strong Sell
Rating :

penystoc