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Two leading economic indicators, interest rates and base metals, have been pretty effective for suggesting where the broad economy is headed.
They both hit the top of respective falling channels a few months ago and turned down. Now a leading-indicator power struggle is at hand — at least in the short term. Yields are breaking support but base metals look to have held at support. Perhaps this is part of the evidence for Bernanke's reference yesterday to "unusual uncertainty" in our economic outlook.
Yields seem to be signaling softness ahead. Watch DBB closely since the ETF seems to turn a little quicker, and a flag/pennant pattern is at hand, which suggests a sizeable move is not far away.
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