Forecasting the US 10-Year Yield: Insights for Q2 and Q3Traders, as we navigate through the second and third quarters, understanding the potential movements of the US 10-year yield TVC:US10Y becomes increasingly crucial. Join me as we analyze the factors shaping the bond market and anticipate the trajectory of the 10-year yield in the coming months.
I'm excited to share a comprehensive outlook, encompassing a short-term surge to 4.625%, a subsequent retracement to 4.3%, and finally, a bold move up to 5% by the end of July.
TVC:US10Y
Prepare for market turbulence! With inflation data grabbing the spotlight, brace yourself for a potential seismic shift in the financial landscape. As inflation data becomes the talk of the town, all eyes turn to the US 10-year yield TVC:US10Y , which stands on the brink of a surge towards the pivotal 4.625% threshold.
We're in for a wild ride as inflation data takes center stage and sets the stage for market volatility.
Reasoning:
Economic Recovery Outlook: Assessing the pace and trajectory of economic recovery will be paramount in forecasting the US 10-year yield. Keep an eye on key indicators such as inflation rates, GDP growth, employment figures, and consumer sentiment surveys.
Inflation Expectations: Rising inflation expectations can put upward pressure on bond yields as investors demand higher returns to offset the eroding purchasing power of their investments. Monitor inflation data releases and central bank statements for insights into future policy actions.
Profit-Taking Opportunity: In anticipation of the yield surge, I'm eyeing profit-taking opportunities on USD pairs. The heightened yield environment could attract investors seeking higher returns, driving up demand for the USD in the short term.
Inflation Data Surge: As inflation data takes center stage, the US 10-year yield is poised to surge towards the critical 4.625% threshold. This anticipated increase in bond yields is likely to trigger a ripple effect across the forex market, particularly impacting USD pairs.
Global Economic Trends: Global economic trends and geopolitical developments can also impact the US 10-year yield. Factors such as international trade dynamics, monetary policy decisions by major central banks, and geopolitical tensions can influence investor sentiment and bond market movements.
As we journey through the second and third quarters, let's stay proactive and informed to capitalize on opportunities in the bond market. Join the discussion as we navigate the intricacies of bond yield forecasting! #US10YearYield #Forecasting #BondMarketAnalysis 📈📉💡
10yrbonds
Knock Knock Who is there? it is me, US10Y 4.2%Knock knock.
Who's there?
I. O.
I. O. who?
Me.
When are you paying Treasury holders back?
Never!
Bullish Breakout ...to be continued...
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Short $IEF at $101?I think a lot of people are thinking that yields will head lower from here, just like they have previously, but I think that bonds will follow the trend that they did last year (which is down), rather than move higher going forward.
If you look at the chart, we're in a bearish trend. We're currently below the key support of $101.58. What looks most likely to me is that we move up to retest that support as resistance, and if we can't break above it, then the most likely path is further down.
If you look at the chart we have a long way lower to go. I think we're in a new trading environment. We have ended the 40 year trend of the long bond and now we're going to reverse the other direction for a sustained trend.
US10Y - ST Pullback in Yield Ahead? Charted is a proposed price pathway for the 10yr T Bonds.
I'm looking for an easing in yield soon... in the 4.125 area (.786 Fib level) specifically, sometime in early March.
This will represent the top of the b wave of wave 4 off the Aug. 2020 low.
This expectation flies in the face of recently released inflation related news. As such my parameters are well defined here. A move beyond the afore mentioned yield will make me reassess the trade.
I'm seeing correlated markets showing signs of synergy with the expected outcome of this move.
Specifically I am expecting a move up in oil, technical ST pullback in DXY and a technical bounce in gold...which will fail and complete a fantastic short set-up.
See my Gold idea...
10yr inflection pointThe 10year is confused! will 2023 be bullish or bearish for earnings? We won't know until probably Q1 earnings, so until then markets will be volatile. If 10Yr heads to 5% you can bet earnings will continue to go higher, and S&P will become cheaper even at around 4000. if 10yr sells off and heads to 1.5% means the fed are cutting rates and earnings are dropping like a lead balloon. Regardless of the fed cutting rates, S&P will become expensive and will need to correct or crash!
I have no idea, either way, the crash comes now, or after the 10yr hits 5%, but the earnings crash is coming...laying off people isn't an option, it creates a crash....
ps every single recessionary metric is screaming recession....
2yr & 10yr Bond with M1Nothing to be concerned about here... if you're an ostrich.
Inflation spiraling out of control, while bonds reflect the loosest monetary policy possible with a dovish Federal Reserve hand-wringing about tanking the markets.
M1 has gone beyond parabolic, practically vertical.
The Fed communicated this week that they will try and control future prices but they're not going to do anything to reign in current "transitory" prices.
Fed Chair Powell "hopes" history will say the current regime got this under control when replying to Senator Shelby in congressional talks this week... to which Shelby replied their actions to this point indicate otherwise.
10 yrIf rates do not get blocked by that weekly 200 ema and reject from the 1.64 lvl then I would say we are heading into some serious pain for risk assets with a C wave target of 2.14 basis points. IDK guys but im thinking 1.64 holds and SP500 completes my C wave around 4250. Then back up to 5,000 EOY
Bitcoin and US 10YR bond, negative correlation?Just have a small thought about the negative correlation between the U.S. Government 10YR bond and Bitcoin. do you see any correlation and what do you think for next month?
some useful links:
July 14, 2021
Fed's Powell says economy 'a ways off' from bond taper, inflation to ease
WASHINGTON, July 14 (Reuters) - The U.S. job market "is still a ways off" from the progress the Federal Reserve wants to see before reducing its support for the economy, while current high inflation will ease "in coming months," Fed Chair Jerome Powell said in remarks prepared for delivery at a congressional hearing on Wednesday.
www.reuters.com
July 26, 2021
Fed meeting may test low U.S. Treasury yields
CHICAGO, July 26 (Reuters) - The $22 trillion market for U.S. Treasury securities may get a reality check from the Federal Reserve this week following a plunge in interest rates that bucked expectations of higher yields this year as the economy rebounds from the COVID-19 pandemic.
Yields, which move inversely to prices, have been in a downward trend since the last Federal Open Market Committee meeting in June. The market initially perceived the Fed as being a bit hawkish as policymakers last month projected an accelerated timetable for rate hikes and opened discussions on ending crisis-era bond purchases amid a backdrop of rising inflation.
www.reuters.com
AUGUST 11, 2021
Fed's Kaplan says central bank should start tapering in October
WASHINGTON (Reuters) -The U.S. Federal Reserve should announce its timeline for beginning to reduce its massive bondholding next month and start tapering them in October, Dallas Federal Reserve President Robert Kaplan said on Wednesday.
www.reuters.com
September 23, 2021
Fed signals bond-buying taper coming 'soon,' rate hike next year
WASHINGTON, Sept 22 (Reuters) - The Federal Reserve said on Wednesday it will likely begin reducing its monthly bond purchases as soon as November and signaled interest rate increases may follow more quickly than expected as the U.S. central bank's turn from pandemic crisis policies gains momentum.
www.reuters.com
September 27, 2021
Fed's Evans: U.S. economy "close" to meeting bond taper threshold
Sept 27 (Reuters) - The U.S. economy is close to having met the Federal Reserve's bar for beginning to reduce its bond purchase program and will meet it soon if job gains continue, Chicago Fed President Charles Evans said on Monday, the latest policymaker to back the central bank's step away from pandemic-era crisis policies.
www.reuters.com
10yr Yield is not on watch mode until we cross 1.9 and the 50MAWe said in an earlier post that the continuation upwards for the 10 yr yeild is a sign that there could be a stock market pullback, that is a pretty good theory but also at the current levels really not a possibility. We are not taking into account any market issues like oh for example 2T worth of dollars pumped into the market. Those mini-bonds are not doing much even given the M1 and M2 charts this month.
What we will look at is technicals and that starts with the 50 MA which we will not reach until 1.9x range and the 200MA which is at the 3 range.
If we continue upwards and cross the 50 and head to the 200 then the market is in shape for a real correction. So yes our earlier trading strategy hit target and is still on the upside we are simply waiting for a touch, cross and hold above of the 50MA to make any serious moves.
10yr Gov Bond Break of 1.69 opens a whole new worldFrom a technical perspective if we break through 1.69 on the 10 yr gov bond yield then we open up a whole new level of charts for a return the larger number target of 3.2.
Substantial in two ways:
1. Higher yields create higher borrowing costs for companies and consumers
2. A larger majority of investors (retail) are people over 60 with retirement incomes to protect, if they continue to receive great returns but the costs to the general consumer market could be too much, these people tend to not spend but save
As painful as it sounds we see this continuing up to atleast 2 and possibly 2.5 in the near term.