ZB - Weekly breakout on Bondschannel breakout and weekly rsi breakout on Bonds. Minimum target 140, 160 or higher if things get really ugly in the stock market.
Bonds
Dollar & VIX ripping, Yields cratering, Stocks fallingGood Morning!
We've been mostly cash when it comes to #stocks. Been defensive as we have #GOLD #SILVER #BCH #BTC (#crypto #altcoins in personal) some $VIX & some bigger VALUE names, added some more today $AMGN $VZ as examples.
We've reduced the exposure as the direction seems south but anything can happen.
FEAR is the word. #Dollar ripping again & bond buying.
$DXY looks good & bounced off of support.
Look @ yields CRATERING again.
1Yr & 2Yr #yields COLLAPSING!
10Yr HOLDING MAJOR SUPPORT & back at level it was 2 days ago.
We noticed something some time ago & will post soon.
$VIX is trading in a new range now & closing in on the TOP part of range. 2 things can happen here. Either we rip through, likely causing a COLLAPSE in #stockmarket OR IT pulls back to the 23ish range and keep in this new range & fear eventually subsides.
TLT 600point Pop From Previous Pattern, What Next?In this update we review the recent price action in the TLT etf and identify the next high probability trading opportunity and price objectives to target
US02Y is on a breaking point. Great news for stocks!The U.S. Government Bonds 2 YR Yield (US02Y) is testing its 1W MA50 (blue trend-line) for the first time since May 31 2021. The 1W RSI is on the very same Lower Highs trend-line rejection that it was during the December 17 2018 1W MA50 test!
Needless to say this shows that the price is on a critical point as when it broke in Dec 2018, a downtrend followed that was at the bottom of the U.S. - China trade war and sent stocks (black trend-line = S&P500) on a 1 year mega-rally (until the COVID crash).
Will we have a repeat?
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Prep for the week 3/12 - SPX GOLD USOIL BONDS and the US DollarExpecting a rally to about 4k to test the important MA's, then reversal. USOIL should be a similar move. Gold may peter soon out if the dollar is going to reverse. Bonds look good to continue to 140 area.
good luck!
$TNX Bouncing nicely as are shorter maturity YieldsWas kind of expected to get some bounce from #Bond #Yields.
The last two days, especially yesterday, was RARE in yield price action. It happens but it's rare.
The buys could have been investors trying to take advantage of higher rates being that they are "expecting" the Fed Reserve to lower rates.
We mentioned that most yields, when we posted, were at or close to support levels.
So the bounce we are getting today is not unexpected. Furthermore, the gap from two days ago attracted and it is filled today.
$TNX was also oversold.
Yields from here are tough to gauge but likely go a bit higher.
Recap of my trade for todayGood afternoon and good evening traders!
I'm sharing with you a recap of my trade for today, actually we caught the 1st up trend after breaking the support line with a quite high volume, then after having the highest volume of the day on the candle I put the 2nd arrow at we added another position to finish the trade on the market with 2 contracts and a respectful profit after seeing a squeeze of buyers and closed at the end of the red candle I put an arrow on. After that the price broke the support line of the channel I shared the trade with you too early to make some profit of it.
For more questions don't hesitate to ask and I'll be answering with pleasure.
PS: The autocorrect changed the FUTURE to FEATURE on the post I posted this morning
Biggest Drop since 2008 - Right After our Post 🙄Good that I always TRUST my Charts:
US Government Bonds 10 YR Yield has dropped 'nicely' since my last post, which was 'against the stream' since when i posted it Powell was being extra-Hawkish and situation was different.
News:
The yield on the 2-year Treasury note fell sharply on Friday as the shutdown of Silicon Valley Bank sparked a flight to safer assets such as government bonds.
The yield shed at least 46 basis points over a two-day period, a sudden decline not seen since September 2008 , when the markets were in the throes of the global financial crisis. Perhaps by no coincidence, the flight to bond safety this week was caused by the biggest bank failure since the financial crisis.
These were supposed to be 'Good news', rates could ease and markets (and crypto) could do better but unfortunately it all happened for the wrong reasons: Some Banks going bust.
Better check my other posts today.
Everything changes FAST so watch out for the CPI tomorrow: If inflation is better the Feds are saved...if inflation persists we could ALL be in DEEP trouble.
One Love,
The always optimistic Professor
So... Recession Confirmed?
With oil breaking bullish support, it's safe to say that demand has been cratering around the world. As Jeff Snider has discussed for months now, if the supply constraints on oil aren't driving oil higher, then there must be a serious demand problem. Overheated economy? I think not.
Add to that Gold up and Yields down and that means low growth + low inflation. Also not good.
So what's the trade?
Well, I think we might be at the start of what Alex Gurevich has called the mother of all bull markets in bonds. Some of these options on bonds could pay out 10x to 20x (i.e., eurodollar futures, SHY, TLT, etc).
Interesting times to live in.
Why are bonds falling today?I noticed a large waterfall sell off of both 2year and 10year. What was reason behind such a volatile move?
Yields are CRATERING - WHy?The Debt Market is significantly larger than the #stockmarket so it's VERY IMPORTANT what happens there.
It's way too early to see data but, JUST A HUNCH, this is most likely the #FED stepping in & buying bonds trying to calm the markets.
This is not normal to see #yields cratering so much.
The 1Yr is off almost 3.26%
The 2Yr is off 5.01
The 10Yr is off 5.33%
This is causing more of an inversion to the yield curve.
On other news, banks faltering isn't helping the case for stability or easing the fears of #economy being in turmoil.
Japanese have been selling bonds, have Yields peaked for now?One of the reasons US Treasuries, and other bonds, have been selling off is the dumping by Japanese investors.
All duration #YIELDS have done well but more so the shorter term. The Inverted Yield Curve has widened over the last few months but has been significantly lately.
However, today we see the 1 & 10Yr ($TNX) selling off but the 2 Yr is CRATERING! Interesting.
Also interesting is that volume has been waning for investment grade and high yield bonds. Liquidity could be an issue later on if this continues.
The market is at critical supportI multiplied SPY, DOW, Nasdaq and TLT together to get a broad picture of the state of the US market and have noticed this channel here.
We are now at a critical bounce area established by the covid bottom and 08 bottom. If it doesn't hold this, then to me it would be safe to assume that this decade long trend is over and it will be reshaped into a new trend after lots of pain just like in 08.
I'm obviously hoping for the yellow line to play out, but it will requite lots of competence from the leaders of the banks and the world to get it in that direction, competence that seems to no longer exist.
If you look at raw material charts like steel, wood or even gold and silver, one would assume the deflation goal has been reached. However, the FED's real goal has never been to fight inflation , but to fight low unemployment, because businesses would rather do share buybacks than invest in their employees.
thehill.com
And we haven't seen news of mass layoffs yet, or government bailouts of failing companies, so Powell's thirst for homelessness hasn't yet been quenched.
You can also see that CPIAUCSL has flat-lined since May and the last time it did this after a big ramp up was just before the huge waterfall in 08. I'm not sure how much stake to put in that correlation though, since it has only happened once on the chart. It still is something to be concerned about though.
UK has reached their pressure limit yesterday, so there's some bullish news. As the UK starts QE, it should put pressure on Powell to give up his tough guy act after messing up so badly in 2020-21 with the endless money printing.
If this support fails, I think something like this chart I made earlier will be the more accurate one:
This chart uses similar calculations, but instead divides by US10Y instead of multiplying by TLT, this gave me more data to work with, but also changed the chart a little bit to show more bearish possibilities.
But I think this is generally a really safe spot to start going long for a bounce and then just keep a stop below the thick support line. Interestingly, the darker blue line and thick blue line are acting as support at the exact same spot. I always find coincidences like that in charts interesting and to me usually means there's even more support there than just one line.
We can't get 100% bullish until that orange megaphone resistance is broken though, so keep that in mind.
Thanks for reading and good luck out there.
Quick analysis on Switzerland 10Y BondsGood afternoon Swiss investors, today I made an analysis on the Switzerlnd 10 Year Government Bonds Yield, it shows that it's too early to put your money on the market since we're waiting for it to cross the golden point to see whether you put your money on it or no.
For any more analysis on a specific market don't hesitate to ask and I'll be answering with pleasure.
A focus on the importance of support and resistance levelsSupport and resistance levels are the lost art of trading any market. In using support and resistance zones, I also use various MA's (Moving Averages) to assist me in finding the perfect entry. Now no trading strategy is completely waterproof. The market will act and react however it wants to, and a multitude of factors can drastically alter price action so take this advice at your own risk. I'm looking to provide a series of videos to assist me in providing this information in a more clear and more concise manner. Support is a zone at the bottom of a trend or series of trends that acts as a trampoline, or (support) to the upside. Resistance acts as a ceiling, or (resistance) that favors movements to the downside. Draw these zones using either a rectangle on higher timeframes or two horizontal lines. There's not a single price that can act as either support or resistance. To create a larger margin of error, we use these zones. These zones usually make up anywhere from 20-30 pips, depending on the symbol in question. Use the MA's to show you where the trend is heading. Bring in other factors such as market sentiment, geopolitics, economic statistics, news breaks, and anything else that can act as confluence in determining where the market may go next. I use anywhere from 3 to 5 levels of confluence before I even think about entering the market. NEVER impulse trade. I also suggest never trading pre-news. When a red folder news event occurs, the market can shake, or "whipsaw" causing price action to rubberband in either direction. These moves are aimed to close retail traders' accounts, and the market wants nothing more than to take your money.
More to come in a future idea - stay tuned.
Happy trading, and as always, use responsible risk management when trading any financial market.
Swindle
Show me a chart that matters more than this?The chart I've created here shows yield on the US 10 Year Treasury Bond. The white line shows its percentage change over the last 12 months.
The red line shows the S&P 500. It shows the S&P 500 over the last 12 months.
What more needs to be said?
The S&P 500 is red over the last year while the yield on bonds continues to rise. REMEMBER: with every increase in bond yield, the risk for things like stocks becomes more difficult. A bond will pay you close to 5%. Apple, on the other hand, will pay a 2% dividend. If Apple does not grow at all, or increase buybacks or new products, or if a recession hits, then the bond yield is indeed the better trade.
The further these two assets widen, the more difficult the trade off becomes.
HOWEVER, that's not to say that stocks and bond yields cannot go up at the same time. Actually, in prior bull markets, they have risen together. If innovation continues, if economic growth continues, and if inflation starts to get under control, we very likely could see this gap shrink in an instant.
I am watching insider transactions to see how much faith top directors, teammates, and employees have in their respective company. Several CEOs have recently bought large chunks of shares out of their own bank accounts. What do this say?
Thanks for reading!
TLT 99.00 Pivotal Hold For Further UpsideIn this update we review the recent price action in TLT and identify the next high probability trading opportunity and price objectives to target
🔥 Bond Yield Curve Inversion Reaching -1%: Why It's ImportantAn inverted yield curve occurs when the yield on a 10-year Treasury bond falls below that of a 2-year Treasury bond. Normally, longer-term bonds have higher yields than shorter-term bonds. This is because investors demand a higher return for tying up their money for a longer period of time.
However, when short-term interest rates rise above long-term interest rates, it can indicate that investors believe the economy will weaken in the future. This is because investors are willing to accept lower yields on long-term bonds if they believe that interest rates will fall in the future as a result of weak economic growth. Essentially, they are willing to lock in a lower yield now, in the hopes that it will be higher in the future.
An inverted yield curve can lead to a number of problems. For example, it can make it more difficult for banks to make money. This is because banks borrow at short-term rates and lend at long-term rates. When the yield curve is inverted, the interest rates that banks earn on loans are lower than the interest rates they pay on deposits. This can squeeze bank profits and make them less willing to lend. And we all know, less money in the market means less potential (risky) investments.
An inverted yield curve can also be a sign of a potential recession. Historically, an inverted yield curve has preceded every recession in the United States since WW2. This is because an inverted yield curve can indicate that investors are pessimistic about the future of the economy. They may be selling off stocks and other assets, which can lead to a downturn in the stock market and a decline in consumer confidence.
In conclusion, an extremely inverted yield curve like now is a situation in which short-term interest rates on government bonds are higher than long-term interest rates. This can indicate potential economic problems, including a recession and difficulties for banks. While an inverted yield curve is not a guarantee of a recession, the probability of the current yield inversion suggesting a coming recession is very high.
It's going to be an interesting year.
TLT - iShares Long-Bond ETF / US30 - Scalp Short, Switch LongThe TLT 20+ year bond ETF has, at this point, been bearish since August.
Personally, I thought after the late December-early January push upwards that TLT would have made a new high before dropping for a while because yields were trading a lot lower than the Fed rate, but that move never transpired and the shares have instead been mucking around.
I don't specifically like this price action for puts/shorts, because there's two big factors that make me believe TLT is going up:
1. On the monthly bars, there's nowhere lower for TLT to go, unless you believe a new all time low is coming:
Monthly
The 2014-2015 lows were taken during last year's bear pulses, in fact.
The same can be said for the weekly candles:
Weekly
When taken in light of the fact that TLT has not traded like it wants to go down for the last three months, this really is a spot that I think a trader has to either stay flat or look for a long at lower prices.
However, there's a big tell that there's a premium short scalp opportunity manifest in US30, the 30-year US Treasury Bond:
US30 30-year US Treasury Bond - Daily
The key factors are:
1. July of '21 was a complete gap fill
2. December of '22 made a lower low
3. The enormous November CPI surprise pump candle gap has been left untouched
4. The '22 year end retrace left the psychological 99.xx level untouched
5. The retrace on TLT to $99.60 was only a sweep of range equilibrium, evidenced by the fact that a new high has not been set. The FOMC candle failed to set a new high, too.
And all of that combines to lead me to believe that the US30 has in the range of 6-10 percent to retrace, and imminently, which would drive TLT down by $7-11.
Moreover, a $10 raid on TLT would make a lot of sense if there's about to be a significant moon mission in the markets. It would take out the December pivot lows, rebalance the CPI-candle gap, and give permanent bears a chance to lose their accounts going short at the bottom.
But I believe if you're going to go short here, you have to treat it as a scalp. Because there's no downside left besides setting a new all time low on the ETF, which mirrors the bond market in its own manifestation, chances are we go up. Moreover, with the Fed clearly slowing the pace of their rate hikes, there's no reason to believe bond yields will exceed 5% for more than a few days until late 2023 at the earliest.
$98-95 TLT would be a long with targets at $120 and $130.
When the markets start to go up again, you have to avoid being short, but you also need to be super, super careful being long. The reason is that the situation in China with Xi Jinping and his Chinese Communist Party being sacked by the Wuhan Pneumonia pandemic is many, many, many times worse than we're being led to believe by establishment media and social influencers.
The number of deaths in China has been terrifying, and whenever you're dealing with so many excess deaths, a country is going to lose a certain percentage of its engineers, technicians, and supply chain. This, in my opinion, is the real reason companies like Apple are moving their production out of China.
So one day in this lifetime of ours when the CCP falls like the USSR did, it will happen overnight, and China daytime is US night time, meaning the US equities and bond markets will go gap down, but this time they'll just stay gap down.
Moreover, the world will change when the Party is gone. The normalcy we've become accustomed to and this way of living as human beings will all change. But the transition won't be so pleasant.
It's very important to value virtue and do your best to cultivate your heart. Atheism and the theory of evolution are unscientific poisons. Never forget this.
US10Y Double rejection. Targeting the 1D MA200.The U.S. Government Bonds 10YR Yield (US10Y) has been trading within a Channel Down pattern ever since the October 21 2022 High and even though there might be a Diverging Channel Up (dashed lines) emerging, the current level makes a strong Resistance cluster.
With the 1D RSI also rejected twice on its Higher Highs trend-line, we are turning bearish on the US10Y again, targeting the 1D MA200 (orange trend-line), which supported the price twice on January 19 and February 02. Potential contact (as a target) can be made at 3.550%. We will continue to be bearish only if the 3.320% Support breaks.
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Interest Rates are Moving Again - Breaking Above Recent High2 year, 5 year, 10 year and 30 year yield are all showing a similar characteristic:
· Low established in 2020
· Major support trend started forming since then
· Seem to have completed its retracement with a double-bottom
· Resuming on its major support trend
· Target to break above its recent all-time high set on Oct 22
Chart illustrated a 10 year yield futures market.
Interest rates and yield moves in tandem, why?
Borrowers (for eg. home owners with loan) take reference from interest rates and lenders (or investors) take reference on the yield. Interest rates and yield moves in tandem.
Meaning if yields are indicating an upward momentum driven by mainly the investors, interest rates will soon to follow or vice-versa.
Though interest rates are making a U-turn from its recent low and breaking above its all-time high.
Are you seeing opportunity or feeling stress with more volatility ahead?
My strategy:
• Have lesser long-term hold on stocks
• Trading into the indices - Sell into strength and trading into the volatility
• Investing into commodities related asset
• Buying into dip(s) on yield futures
CME Micro Years Yield Futures
Minimum fluctuation
0.001 Index points (1/10th basis point per annum) = $1.00
Disclaimer:
• What presented here is not a recommendation, please consult your licensed broker.
• Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises.
CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
United States 10-Year Bond Yield - AT RESISTANCE 🤨👎Massive level of resistance has played out and Stocks could power higher as Treasury yields and dollar might ease further.
4,22% has been a Major Support/Resistance level (S/R as you can see on the chart) and the prices down have dropped even lower, below the psychological 4%
What does that mean?
When US government bond yields are on resistance, meaning they have reached a point where they are likely to reverse direction, it can have a significant impact on various aspects of the economy and financial markets.
One of the most immediate effects could be on the stock market. Higher bond yields could lead to a sell-off in equities as investors may shift their money from riskier assets to safer ones like bonds. This could result in a temporary decline in the stock market and a potential increase in market volatility.
The impact on the broader economy is more nuanced. Higher bond yields can lead to higher borrowing costs for businesses and consumers, which can slow down economic growth. However, if the bond yields are rising due to a strong economic outlook, it could be a sign of healthy economic expansion, which could offset the negative impact of higher borrowing costs.
The Federal Reserve's monetary policy could also be affected by rising bond yields. If the Fed believes that rising bond yields could lead to an economic slowdown, it may adjust its policy by lowering interest rates or increasing its asset purchases to keep borrowing costs low and support economic growth.
In summary, when US government bond yields are on resistance, it could have a significant impact on various aspects of the economy and financial markets. It could result in a temporary decline in the stock market, higher borrowing costs for businesses and consumers, and potential adjustments to the Federal Reserve's monetary policy.
What's next?
🆘 The Feds are lots of data to watch out for:
📌 Fed Chair Powell speaks on Tuesday/Wednesday
📌 JOLTs job data on Wednesday
📌 Fed Beige Book on Wednesday
📌 Fed’s Barr speaks on Thursday
📌 February jobs report on Friday
📌 Final week of Q4 earnings
Hopefully, this is a good sign to see a further rebound in the markets and a more dovish Federal Reserve.. unless they are aiming for chaos in which case they intend to raise rates over the 6%
One Love,
The FXPROFESSOR
My Thoughts on Treasury Yields and Why You Should Care5% of on a 1-year US Government Bond Yield?
I never thought that I would see the day.
Many of us have grown up in a low rate world. Today, you buy a US Treasury bond, hold it for a year, and get 5%. That's more than most stocks yield in dividends, probably nearly double or triple the average. However, it's said that the S&P 500 averages 7% a year or so. Nonetheless, factor in recession fears and the trade becomes even more interesting.
What are government bond yields?
A government bond is a debt security issued by a government to raise money. When you buy a government bond, you're effectively lending money to the government in exchange for interest payments. The yield on a government bond is the return you'll receive on your investment, expressed as a percentage. So if a bond has a face value of $1,000 and a yield of 3%, you'll receive $30 per year in interest.
Why are government bond yields rising?
I can list out those reasons for you below:
1. Inflation
2. The Fed is purchasing less Treasuries
3. Economic growth is slowing, which means taxes will be less
What are the major implications?
Opportunity costs.
I'll say it again: Opportunity costs.
Everything that is bought, sold, and/or traded now must be weighed against this 5% yield. Do you want to buy Apple for the next year at its current valuation or take a risk to get 5% on a Treasury bond? You can substitute Apple for anything and everything that comes to mind from construction investments to crypto.
Do I own any bonds?
NO. I missed it and am only now paying attention. Will I potentially add some to my portfolio? 5%? It's possible. That's why I wrote this idea. I want to share my thoughts and add a few of these symbols to my watchlist.
I look forward to reading your comments!
