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Bund / T-Note Ratio as a Predictor of S&P 500 by the Close of S1 2019

Analysis from Éric Chwaliszewski / @ChroniqueBourse posted June 30th 2019.

By the close of the semester the S&P 500 index has confirmed the continuation of the phase 3 uptrend. One more time, the Bund / Tnote ratio has been a remarkable predictor of the stock market price action by forecasting its progress two semesters in advance. This delayed price trend relationship that was tweeted multiple times before and relayed in a previous analysis from March 31st 2019 just received another confirmation.

Phase 3 Uptrend Continuation

By closing above the black line (9) the S&P 500 index has validated the continuation of the phase 3 uptrend. This line is not a charting line but a dynamic one as it corresponds to the Bollinger bands phase 2 uptrend*.

*Editor’s note: A phase 2 uptrend is ending when the Bollinger bands are no longer diverging and when the lower band turns up.

How to Use the Ratio?

The answer was provided in the March 31st analysis. For the sake of simplicity all it takes was to trust the “ATS system” (TSA in english for ‘Technical Systemic Analysis’) and the Bund / Tnote ratio and waiting until it happens while checking that the ratio still was at point number (9).

Quote from March 31st 2019:

How to use the ratio? Since the ratio is generally in advance on the S&P 500, its use is both simple and passive. As long as the ratio is in a phase 3 uptrend continuation (above the black line) it is possible for the S&P 500 to follow suit. In the contrary if the ratio decreases below the black line it then becomes possible to question the continuation of the S&P 500 uptrend.

Once more the ratio has been the infallible twin of the S&P 500. Not only was it possible to predict where it would be at the close of the semester it would have been easier to catch a falling knife when supports were positively converging on June 3rd 2019.


Creative Commons License (in french)
Licence Creative Commons
Analyse Technique Systémique de Chwaliszewski Éric est mis à disposition selon les termes de la licence Creative Commons Attribution – Pas d’Utilisation Commerciale – Pas de Modification 4.0 International.
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