🔥 US Bond Yields Suggest More Interest Rate Hikes: BEARISH 🚨
The US 2-Year bond yields are important because they tell us how much returns an investor will get by lending his money to the government. In periods of higher economic risk, investors demand higher returns. Thus, the height of the bond yields can be used to determine whether we're in an economically risky period or not.
As seen on the chart, once the 2-year yield starts increasing, the FED will increase the interest rates. Higher interest rates are BEARISH for the markets.
With the 2-year yields making a new high recently, it suggests that the FED will need to increase the interest rates further. Is the current 25 basis points enough to tame inflation and market risk? Certainly not if the yields will keep like this.
If the yield will keep on rising there's a decent probability that stocks will continue to go down. If so, crypto will likely follow.
For now there's little reason to believe that we're going to make new bear-market lows, but once stocks will really start selling off this probability will increase. Will monitor.
As seen on the chart, once the 2-year yield starts increasing, the FED will increase the interest rates. Higher interest rates are BEARISH for the markets.
With the 2-year yields making a new high recently, it suggests that the FED will need to increase the interest rates further. Is the current 25 basis points enough to tame inflation and market risk? Certainly not if the yields will keep like this.
If the yield will keep on rising there's a decent probability that stocks will continue to go down. If so, crypto will likely follow.
For now there's little reason to believe that we're going to make new bear-market lows, but once stocks will really start selling off this probability will increase. Will monitor.
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