Money is 'Pouring Out of Government Bonds': Charts
The government bond market rally is over and investors are switching their portfolios to the stock market, Royce Tostrams, technical analyst at Tostrams Groep, told CNBC Friday.
"Money is now pouring out of government bonds. So my conclusion is don't be in the bond market anymore," Tostrams said.
"Money coming out of the bond markets is now slowly finding its way towards stocks," he added.
Robin Griffiths, technical strategist at Cazenove Capital, agreed with strategy of reducing exposure to government bonds when he spoke to CNBC last week.
"Our major call starting about now is we would sell all long-dated government bonds … (w)e think the stampede into government bonds has gone far enough," Griffiths said.
Many of the major European stock markets appear to be breaking to the upside, which backs up the trend away from bonds, according to Tostrams.
"Germany has been broken on the upside, France has been … Amsterdam will follow the other stock markets on the upside," he said.
Tostrams said that both the long-term uptrend and also the short-term uptrend have been broken in the Dutch 10-year government bond and it's seeing "selling pressure."