Bill Baruch thinks bonds are building a bottom. He called the Treasury sell-off a quick move, pointing to window dressing and the carry trade, and says the worst of the selling looks to be behind us barring a hot jobs report. He also flagged the bullish percentage index for the S&P 500, which sits at 34 compared with about 31 at the March low. The VIX is in the mid-teens now versus the mid-20s then, and when the index gets to these levels he says the probability leans toward a sharp rally. With the S&P 500 only 2 to 3 percent from record highs, he is excited for the fourth quarter. Watch the full discussion here.