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DE30Y

A Macro Thread on YieldsThe bond market can be quite tricky. In terms of yield curves consider the following: Bear steepening Bull Steepening Bear Flattening Bull Flattening > Steepening (the premium for longer debt is growing) > Flattening (the premium is shrinking) For example, bull steepening, which is exactly what we have been doing this since the start of this year: The short-end of the yield curve (typically driven via fed funds rate) falls faster than the long-end, steepening the yield curve. The long end of the yield curve is driven by a wide range of factors, including - economic growth, expectations, inflation expectations, and supply and demand of longer-maturity Treasury securities and etc 📍 A bull steepener ↳ is a shift in the yield curve caused by falling interest rates - rising bond price - hence the term “bull”. 📍 A bull flattener ↳ is the opposite of a steepener - a situation of rising bond prices which causes the long-end to fall faster than the short-end. 📍 Bear steepness and flatteners ↳ are caused by falling bond prices across the curve A bull steepener is a change in the yield curve caused by short-term interest rates falling faster than long-term rates, resulting in higher spread between the two rates. A bull steepener occurs when the Fed reserve is expected to lower interest rates. This expectation causes consumers and investors to become optimistic about the economy and bullish about prices in the stock market above the short-term. Thanks as usual for keeping the feedback coming 👍 or 👎
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TVC:US02Y
by ridethepig
21
ridethepig | A Decisive Break in BundsThe positional strength in Bunds was just too strong to contain, the rest is obvious. Now play the topside, retraces into buyers jurisdictions at -0.35 and -0.50 will attract a lot of selling interest in bunds (hence pushing yields up) and triggering the capitulation. We are still set for an emphasis of consolidation across Global Equities, this is still all part of the 'knee jerk reaction' phase. Many large hands were caught badly on the sharp moves lower, a legendary retrace is offering the opportunity for final repositioning flows for a secondary leg lower into 2021/2022. Before we can then move higher for the rest of the decade. For those tracking German Equities, the overshoots in DAX were very bad: Strong Resistance 0.15% <=> Soft Resistance -0.15% <=> Mid point -0.30% <=> Soft Support -0.35% <=> Strong Support -0.50% This leg higher in Yields is no surprises for those tracking the conversations on the eurobonds. The breakup in Bunds will also carry important implications for the EURUSD chart and 'Eurobond' positional flows: " So we are gradually getting round to what is an important component in the process of formation in the currency. Like a trojan horse, Eurobonds are being pushed in from the mounting political and geopolitical pressure. The initial 500bn EUR will still require approval from the block, and may not be a huge sum considering a historic crash, however it is an incremental step in a positive direction. It is not really about the effectiveness of the implementation, and this is decided from completely different factors and distribution is not that clear. " The market loves it...there is no question, we are seeing Europe strike a major expression on the world during this crisis and forming a protected outpost from an economic standpoint. The charming twist to this story, will be to track the pressure this applies to rates.I do not like the 'business as usual' story because of the reply: Clearly things are looking awful on the inside awful despite how politicians and media are selling the reopenings...I have never seen anything like this in my life, the unpleasant feeling that we will see a second round of cases in the Northern Hemisphere remains and that will need to be given some elbow room... Consumer confidence remains the one to track; the glimmer of panic appearing and equities will snap, the same move we have been tracking. All pullbacks should attract buying interest and outlook for Bunds remain in " Buy ". As usual thanks for keeping your support coming with likes, comments and etc!
TVC:DE10YLong
by ridethepig
5
#de30y - Please, please take the money ;-) #eurobonds #ecb #fedPlease, please take the money and keep it forever. Repayment is just like interest payment - devil's stuff, that's why the investors like to pay the interest to the (above all, God like) German government, so the burden of economic decision is taken away from the investors. The honorable and cheered government can distribute the money to all big companies and their shareholders, as well as to our EU-Friends. (Irony off) 1st target: - 0.9% p.a. 2nd target: - 1.5% p.a. 3nd target: monetary reform Greetings Stefan Bode
TVC:DE30Y
by StefanBode
6