Sugar has been a decent leading indicator per where interest rates were heading in the near future.  A few weeks ago some very smart people were taking fresh short pistons in government bonds, while I created a quiz, suggesting it was a time to “buy bonds due to long term yield resistance was at hand.” (see quiz and bond suggestion here) 

Not only was yield resistance at hand, Sugar was breaking key support and looking like it wanted to roll over to the downside!

Game Plan…Now Sugar and Yields are testing key support at (1) in the chart above.  Should they break support, they would be signaling that some economic softness is not far away! 

It is this type of situation that has had me overweight into bonds/dividend plays (TLT, IEF, LDQ, high yields and PFF) all the while some brilliant people are shorting them.

How The Recent Decline In Stocks Looks "Eerily" Like Major Bear Markets Of The Past