The bond market is key.
If interest rates breakout from this point, we’ve got a set-up that mimics August 1987, on steroids.
The chart below shows ten-year interest (rates up, bonds down) is back at the trend-line.
It’s before the open and pre-market (as of this post) also has the ten-year (and the TLT) trading lower.
Two well known and liquid inverse funds for bonds are TBT (2X-inverse) and TMV (3X-inverse).
A price action insert of TBT, is shown on the TNX chart.
There’s a potential for today’s price action to make a new daily high.
If so, a possible trade (not a recommendation) would be an entry at the last session high, 15.74, with the stop at the last session low, 15.50.
If such a position could be opened, the risk therefore is 0.24-pts, barring any catastrophic adverse move.
Charts by StockCharts