At almost every major turning point in the stock market we have seen bonds lead the way. In `07 bonds topped out 4 months before the stock market. The same thing happened in 2000. Bond yields started to rise 3 months ahead of the March bottom in stocks last year.
Far from topping out, bond yields are still rising. As a matter of fact they are still holding above a sharply rising 200 DMA.
If this was going to be something more sinister than just an ordinary profit taking event in an ongoing cyclical bull, bond yields should have begun dropping several months ago.
I believe we saw the end of the secular bear market in bond yields last year when Bernanke assured us he would artificially hold rates down to stimulate the sagging real estate markets.
Realizing that the only way Bernanke could have any chance of accomplishing his goal was to print untold trillions of dollars out of thin air, the bond market responded by rapidly reversing Bernanke's manipulated move and rates have been rising ever since.
Since the beginning of `09 the bond market has been discounting the future and deflation is not what it's been discounting.