I pointed you to the RSI on the 10-year Treasury Notes.

Bonds: Bonds rallied yet again but are now over-bought; The U.S 10-year Treasury bond is now yielding 4.726, but is screaming to go back to 4.95 or so. Inflation has not disappeared; When I look at the 10-year T-Note yield index Weekly RSI-7 (25.7), and the Daily (12.6), I'm thinking that bonds are well into over-bought territory. This is just the first up-wave in the new Bull market for bonds. As I always say, let's look at the whole cycle " the up and the down " before drawing a conclusion that buying bonds is a safe and prudent investment.

Well, a day and a half later, the move I forecast was almost 50 pct complete, and some people were shocked when I made it. How quickly the bond market turns.

When you see a Daily RSI-7 on the yield down as low as 12, and you want to buy the bond, it pays to wait a few days or possibly weeks. Let the cycle complete.

[note: the chart above is a 15-minute data series chart, so the RSI does not correspond to the RSI on the Daily Data, which is the chart I was referring to in the WIR. But, the same lesson can be learned. If you are an intermediate-term oriented trader, you need to use the Weekly + Daily RSI, not just the Daily. If you are a long-term oriented trader, you need to combine the Monthly-Weekly-and-Daily RSI. I always look at them all in order to set my mind as to my perspective on the possible holding period and possible commitment size when entering a trade.]

On the other hand if you are ready to buy that stock or bond, and the Daily RSI-7 is down at 10 on the instrument price, there is likely to be a reversal, so buy it then.

Of course, if you are an intermediate-term trader (say 3 to 12 month holding periods), then you need to see a Weekly RSI-7 down there too (ie, in a Bear market " or 30 in a non-trending market, or 50 in a strong primary Bull market).

And, if you are a long-term oriented trader (a holding period of at least one year), you look to the Monthly price series technical indicators.

Just remember, technical indicators are just indicators. You need to understand the fundamentals and quantitative data as well as the technical in determining when you ought to be adding or removing capital in the market.