Bonds Outperforming Equities

Well, this was initiated couple of months ago. Mary Ann Bartels et al. at BofA Merrill Lynch paints the bigger picture of equities versus bonds, and note today:

From a mid February high, the stocks vs. bonds ratio has corrected and is testing the rising 200-day moving average.

There are not yet any firm bottoming signs for stocks relative to bonds. This suggests that stocks should continue to underperform bonds in coming days/weeks.

Click on chart to enlarge, courtesy of BofA Merrill Lynch.

Should we assume we move towards the bottom of the channel?