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T-bonds

US30Y interest rate hike prognosis over the long term.Due to the rising inflation, the Fed has stepped in to reign in inflation. Jerome Powell has stated numerous times he will be aggressive with rate hikes just like Paul Volcker was in the '80s. Powell and Volcker are of the same school of thought. "Inflation emerged as an economic and political challenge in the United States during the 1970s. The monetary policies of the Federal Reserve board, led by Volcker, were widely credited with curbing the rate of inflation and expectations that inflation would continue. US inflation, which peaked at 14.8 percent in March 1980, fell below 3 percent by 1983. The Federal Reserve board led by Volcker raised the federal funds rate, which had averaged 11.2% in 1979, to a peak of 20% in June 1981. The prime rate rose to 21.5% in 1981 as well, which helped lead to the 1980–1982 recession, in which the national unemployment rate rose to over 10%." - Wikipedia on Paul Volcker What does that mean for us? In essence, lower equity prices, temporary economic contraction and higher lending rates to reign in cheap capital. Looking at the 30 year US government Bond Yields (US30Y), I am expecting yields to continue to increase from current 3.2% --> 4.1% --> 4.8% --> 5.5% and finally 7.2%. If inflation continues higher, then rates will likely continue to rise over the next few years. The era of cheap lending is over. Trade safely.
TVC:US30Y
by DenisRisticFX
Bonds Benefit from Risk-On OutflowsBonds have picked up, breaking through several of our upside levels. We set a target of 119'23, and that is exactly the level we've reached. We are seeing signs of resistance here from several red triangles on the KRI. The Kovach OBV has picked up however, but it is doubtful momentum will take us much further, given the market conditions. If we are able to break out again, then we should see resistance at 120'14 and 121'00, who relative highs. From below we will have support from 119'01 and 118'04.
CBOT:ZN1!
by quantguy
US10Y broke a historic trend-line from 1981. What's next?The US Government Bonds 10 YR Yield, broke last month above a historic Lower Highs trend-line that has been holding since September 1981. This chart is on the 1M (monthly) time-frame. By doing so, it also broke above the 1M MA200 (orange trend-line) for the first time in history as well. Even though it hasn't broken above the previous Lower High of November 2018, which is currently the Resistance, we have to consider the implications of this historic break-out. The 1M RSI has also hit a multi-year long Higher Highs trend-line and got rejected, making it a Resistance. Unless the November 2018 High breaks, we may see the 1M MA200, even the 1M MA50 (blue trend-line) being tested as Supports. A break above the November 2018 High though, will basically confirm a historic change on yields, especially as the Fed has already announced plans to continue raising the interest rates aggressively in an attempt to battle the raging inflation. The green trend-line on the chart represents the Federal Funds Rate and as you see its Highs have historically matched roughly the Highs of the US10Y. Since the Rate is now still relatively low and as per the Fed's remarks, we are still early in the rate hike cycle, we can see the US10Y break much higher in an aggressive manner in the following months. So what do you think? Does this break mark a historic change on bond yields? -------------------------------------------------------------------------------------------------------- ** Please support this idea with your likes and comments, it is the best way to keep it relevant and support me. ** --------------------------------------------------------------------------------------------------------
TVC:US10Y
by TradingShot
5
Joe Gun2Head Trade - US 10 Year Yield topping out?Trade Idea: US 10 Year Yield topping out? Reasoning: Head and shoulders top on the hourly chart Entry Level: 2.842 Take Profit Level: 2.617 Stop Loss: 2.922 Risk/Reward: 2.81:1 Disclaimer – Signal Centre. Please be reminded – you alone are responsible for your trading – both gains and losses. There is a very high degree of risk involved in trading. The technical analysis , like all indicators, strategies, columns, articles and other features accessible on/though this site is for informational purposes only and should not be construed as investment advice by you. Your use of the technical analysis , as would also your use of all mentioned indicators, strategies, columns, articles and all other features, is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness (including suitability) of the information. You should assess the risk of any trade with your financial adviser and make your own independent decision(s) regarding any tradable products which may be the subject matter of the technical analysis or any of the said indicators, strategies, columns, articles and all other features.
TVC:US10YShort
by Signal_Centre
Waiting for the worst...In the chart we have the SPX versus the US10Y (US 10 Year Government Bonds Yeld Rate, in the blue line). We are at a peak moment. In principle, the rate in US10Y is inverse, that is, when it goes down, more people are buying — more people leave the stock market and buy government bonds. The correlation with SPX is high in periods of extreme volatility, as shown in the circles. Frighteningly, the US10Y is close to the same levels as March/2018 and October/2018. If it drops like it did before, will we see a strong correction in global markets? Analyzing the US10Y alone: The US10Y has broken up a long bearish channel. The RSI (Relative Strength Index) indicates an extremely stretched value, signaling a possible reversal to the downside. On the weekly chart it is in a resistance test region, similar to the periods mentioned.
SP:SPXShort
by andre_007
US10Y-US02Y Yields Are Steepening NOWAhead of incredibly important CPI data to be released tomorrow, we are seeing yields steepen in a very dramatic fashion. In comparison to each of the last 3 inversions, this one is not even close to the past. It is important to understand that when yields steepen , it systematically leads to downside in the SPX/NASDAQ. It has been the indicator of almost every recession since 1980 . Now we can't jump to conclusions just yet, we can only try to anticipate what comes next. Tomorrow key CPI data gets released which is why markets are selling off in the face of it. This data will be the reason for the next move up or down. Focusing back on the chart, we can see just how far yields have deviated from the 200MA. In comparison to the past, this is the farthest divergence on record. IF yields were to retest that 200MA, it would almost certainly lead the markets down a very dark path rather quickly. We are seeing a clear momentum gain on the RSI to match this. Now let's take a look at the previous two inversions not shown in the chart; (2000, 2008) First, take note of where the 200MA is here in comparison to now. Second, notice when yields are Steepening the SPX is falling. They have an inverse correlation. Take a look at how extended the NASDAQ is still; The same can be said about the SPX; There are very significant moves being made in the markets at this moment, and it will take absolute diligence to ensure survivability if the markets take us down a dark path ahead. For now, pay attention to the data tomorrow. If it is optimistic, we could see some short-term relief. If it is worse than anticipated, watch CLOSELY! The projected CPI tomorrow is 8.4% . That's your best case going into tomorrow (April 12th) . Use it as a measure.
TVC:US10Y
by NoOneWhoIsSomeone
4
The Bond Selloff ResumesAs anticipated the bond rout continues. We saw a brief relief rally after the FOMC, as the hikes were largely priced in. However, 119'01 provided prohibitive resistance, and ZN immediately rejected it. We found brief support at 118'04, but have broken through this level, and are currently clinging onto 118'00 by a thread. The next target is the level below at 117'19. The Kovach OBV is extremely oversold, so watch for a relief rally, which could test 119'01 again.
CBOT:ZN1!Short
by quantguy
DOW / NASDAQBear Market signals persist. When the DOW begins to outperform on the downside, we have a clear indication of a lengthy BEAR Market. It's just beginning. Counter Trends are a normal course in prolonged Trends. The ONLY real reversal... QE: Global Central Banks began withdrawing Liquidity via RRP's since July of 2021. The contraction made a controlled contraction below 0 into a negative range well below the Peak Monthly $1.5T down to $300B and on down to 0 in January, going - $250B during the 3rd week of January - they have maintained the drain since this time... it is remained between -$180 to -$255B to the present. Lows into October 2023 imho.
CBOT_MINI:YM1!
by HK_L61
Macroeconomic: Long Bonds/Stocks, Short GoldGold bug's biggest complaint is ALWAYS manipulation of Gold prices... Enter: exhibit 1. This is the spread between Bonds and Gold, and it has reached maturity and should reverse from here IMHO. With yields at 3%, banks will enter the bond market en masse, hedging that position with a short on Gold. With yields finally attractive, the US DX will also continue to rally which will be good for both bonds and stocks. For Gold, here you can see the EW justification for a return to lower levels as part of a 4th wave (before eventually making new highs). Then a zoom in on the current breakdown: I think a short position in Gold is justified, as well as long Stocks. The bottom in Bonds has not yet shown itself but could be any minute or day IMHO. I think the biggest risk to this macroeconomic analysis is that we will see a deflation across multiple assets as a result of rising rates, which will be apparent if stocks don’t rally and bonds continue lower.
CBOT:UB1!
by FuturesIntelTM
Bonds Continue the Bear RoutBonds have taken another turn south, after flirting briefly with 119'23. With the Fed maintaining their hawkish stance, there is little to support a breakout, or a significant technical retracement. We have broken through lows at 119'01, and are currently hovering over our next target at 188'04. The Kovach OBV has been abysmally bearish for some time now, but does seem to be gradually leveling off, perhaps indicating a bottom soon. If we see a relief rally, then 119'23 should provide resistance.
CBOT:ZN1!Short
by quantguy
TLT (Elliot Wave - Analysis) Applying simple Elliot wave analysis, I see an ABC pattern with a failed 5 wave move up marked as X wave, the first ABC is then labeled as W and projected 1:1 ratio from top of (X) brings us down to the box area, where TLT is most likely to find support (1:1 & 1.236 Fib ratio). I see the price dropping without retest of major resistances that it broke through, and a price fall in a straight line is unsustainable, its like stretching a rubber band and eventually price will rebound violently. I would give it a 60% probability of reversal at that point and daily bullish divergence should be a very strong sign of imminent reversal. Cheers
NASDAQ:TLTShort
by Elliot618
Bond yields in the era of high inflationAs you can see on the main chart, 10y bond yields have broken above their downwards channel and are now back at their 2013-2018 highs. Based on technical analysis we don't have a confirmation that the trend has fully reversed until we get a close above 3.2%, but we are pretty close to breaking above that level too. Now we aren't only seeing the 10y yields rise, as all kinds of maturities are rising at the same time and are rising pretty fast. The trend is showing no signs of exhaustion and this could get pretty ugly for the world economy, as the Fed has barely raised rates so far and they are threatening to raise rates by 0.5% at every meeting in 2022. Many analysts claim that the bond market is broken and that yields will rise even further, but are they correct? Well the truth is that the way bond market topped (yields bottomed) in March 2020 is definitely an indication that a bull market is over. Currently the market has broken below most major support lines and seems to be accelerating rather than decelerating, while the correction from the peak is indicating that the bull market is over, as during bull markets corrections tend to stay within a certain range, and this correction is way larger than any previous corrections. At the same time the 2y year yields are above 2.5%, a level that they 'shouldn't' have broken if the bond bull was intact. The reason behind this is that usually 2y bond yields would never go above the peak of the Fed Funds Rate and during the last hiking cycle the FFR had peak at 2.5%. Currently the 2y yields look like the formed the perfect round bottom (bullish technical pattern) and have broken above their downwards channel and could also be headed higher in the medium to long term (an indication that the bond bull could be over). However not everything is really bearish for bonds at the moment and there is some hope for the bull market, even if that means we only get a strong bounce before going lower. As the 10y and 30y yields haven't broken above their resistance levels yet, it might be a good time to start buying bonds. Why? Well as yields are at resistance, bonds are close to support. The actual bonds are so oversold, that the current move might be getting totally irrational. Yes inflation is going up, yes inflation could go higher and inflation expectations keep rising, but the rate of inflation could come down. Not only that, but the Fed is so trapped that everyone knows they can't really raise rates much more or sell bonds without breaking the market. Financial conditions have already tightened so much, that investors will eventually run to the safety of bonds which finally have a pretty attractive yield. Of course my reasoning doesn't just rely on some random fundamental analysis, but also some technical factors. The first one has to do with how this break of the trendline could be a trap and this move is headed straight into a very important area in which there is strong support. On TLT there is a major gap at an area that was support, it was broken and then the market quickly closed back above it. That's the perfect place to go long. The second one has to do with the fact that the yield curve had inverted and has now un-inverted itself. Usually inversions happen close to the bottom of the bond market (peak in yields) and therefore this could be another useful signal that a bottom isn't far away. Again this doesn't mean that someone has to go long right now or go long big, just that maybe its time to cut down shorts and put on some small longs. Personally I like to move between being a bond bull or bear based on the data and not have dogmatic views about what will happen in the future. Finally I'd like to talk a bit about junk bonds, which are at the same level they were when the Fed had raised rates at 2.5% and kept saying that they would keep hiking. With so much debt in the world, the Fed threatening to keep hiking rates and the global economy being in shambles due to Covid-19, aging demographics, supply chain issues, lockdowns in China, the Russia-Ukraine war and commodity shortages, it is hard for someone to really see how owning junk bonds is a good long term bet here. Shorting junk bonds is probably the best bet someone could take at this stage, if he/she believes that there is going to be a major collapse either in the stock market or the bond market. What I find very interesting is how resilient American companies have proven to be, and how after so many major crashes since 2008, now junk bonds are rallying against treasuries. By looking at the HYG/TLT ratio, we can see how they have outperformed since the March 2020 crash, potentially due to how much the US government has support those companies and how much more the private sector has benefited from low rates and money printing compared to the public sector. By adding to the mix how strong stocks have been over the last 2 years despite all the negative events, we can make sense of why junk bonds are outperforming us treasuries. Maybe this is also a major sign that buying stocks is a much better idea in the long term than buying bonds, and that the stock bull market is still intact, but that's a topic which I will discuss in another idea. In conclusion, the bond bull could be over. There are several signs indicating extreme weakness in bonds as inflation expectations keep rising and the Fed is unwilling to support the bond market. Yet we are at levels that not buying bonds seems like the wrong decision, even if buying them would only for a short time period only.
TVC:US10Y
by BitcoinMacro