An Epiphany Draws Near

Treasuries are trading more closely to the spirit of equities than they have in a while, with today's downside reversal in TLT coinciding with rate-sensitive sectors like IYR XLU flipping red, too. TLT has marginally taken out yesterday's lows, a place where buyers assumed the usual snapback rally would materialize. 

As "summer trading" unfolds, I am looking to see if the thesis of equities and bonds trading in lockstep continues, conjuring up the old axiom that highly correlated markets are not a good sign. 

In addition, the transports continue to weaken, plunging below the 8,600 level we looked at yesterday on the Dow Jones Transportation Average. 

We have been short UNP inside Market Chess Subscription Services for a while now. And I am looking to see if the major airlines follow the rails lower.