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The record-breaking decline in interest rates has caused two events to take place: We see a bullish falling wedge in yields and our Sector/Sentiment Update tells us that 77% of investors are bullish on bonds. (See my where have the bond bears gone post).

Historically, falling wedges have about a two-thirds chance that an asset will move higher.

 

 

We shared in a post this past weekend that a trend toward higher rates is possible because Wall Street strategist were very bullish on bonds, suggesting the highest exposure to bonds in the past 15 years!

Why didn't they suggest this huge exposure to bonds before rates hit their lowest levels in decades?

 

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