Interest rates break resistance, expect them to pick up speed upward soon. [$TNX.X] [UUP]

Here is the backlink.  People who do not know about EW will think the recent bounce is just any old bounce but I think the recent action is likely a breakout of the top rail of WC.  Folks, if my count is right, that was the bottom of wave 2.  That means a 3rd wave is on deck meaning rapid moves per unit time.  Again, playing interest rates might seem like a glacial undertaking but the percentage moves promise to be worthwhile.  $TNX.X was $26 only back in Sept 2014.  By June it should be back to that level.  That's $8-$9 on an $18 ETF, nearly 50%.  Most people would be happy with just parking cash here and setting stops just below that upper orange rail.  Own it above the line, stop out below the line.  Simple as that.
 
Until I can find something better, I plan to trade this with DTYS, currently trading at $18.70.  If you know of something more leveraged, please leave a comment and I will post update charts on it.  The question we really want to answer here is what will really move if interest rates take off like I model that they will.

Of course, correlations as mentioned above are not working very well anymore.  Case in point: check out this post on the dollar from May 9, 2014.  My wave count said a bottom was likely in.  Specifically, this chart called the $21.15 dip as being the exact bottom.



In fact, that final sell off circled in blue and labeled as 5 was the exact bottom.  Here is what happened next:

And now here is something that I think is going to be important to remember going forward, learning from my own lessons.  That May 9th post had two aspects to it:

1. A wave count
2. A prediction about the direction of stocks based on some interpretation of the fundamentals (stronger dollar will immediately weigh on stocks).

The wave count was exactly right but conventional wisdom was exactly wrong.  It's just like Prechter has been saying all these years, you really cannot reliably make correlations between anything.  The wave counts on the other hand, are much more reliable and sometime even damned near perfect.

While I'm talking about UUP I might as well update on that as well.  In short, a near term peak is now in as 5 waves up have completed and we should quickly begin to see the chart break down the upper orange rail.  The orange rail will fail as well during the pullback.  The level of the prior 4th is just shy of $22.50, the 38.2 fib is $23.67, the 50 fib is $23.19 and the 61.8fib is $22.80.

While it is not the conventional wisdom count nor my primary count, it is possible that the recent spike in the dollar was a C wave which means it could eventually give up all its gains and then some.  Again, something to keep in mind longer term.  But short term, the wave count says best odds are found being a dollar bear.