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Treasuries

Uranium the anti-COVIDThanks for viewing. No, not as a treatment - please don't inject uranium as a treatment (if Uranium came in a bottle it would need a warning for Americans). Competition? What I mean is that Uranium has been on a run starting from when the equity markets showed weakness - and has yet to show signs of slowing. I'm not sure what the relationship is yet, as crude, coal, and natural gas are down in 2020, which would make them more competitive as energy sources. Energy Security? It could be that crude, coal, natural gas, wind turbines, and solar panels all have rather long, and as we have seen, potentially vulnerable supply chains. Maybe, it is about energy security. Uranium needs for the US aren't all mined at home so that wouldn't account for it - although adding supply from long-standing allies like Australia could probably supply the needs of North America while having security of supply. Is it about the environment? That could be part of the picture - as long as everything is well managed. There is that "catastrophic and uninsurable" hazard if things go wrong. The energy itself is clean, although the capital expenditure is considerable. Finding a long-term storage place for the waste hasn't been solved yet in the US. Hard assets? Expectations of future inflation in light of historic levels of quantitative easing and currency printing are possibly driving the search for hard assets with use-value. As I look around the markets, very little appears undervalued. Equities, bonds, treasuries, gold all appear to be, if not over-valued, then not cheap. The most popular store of value in the world, and the destination of huge amounts of funds: treasuries don't even seem to be worth a second look at the moment and any up-tick in interest would wipe out a significant portion of those positions. Expectations of an up-tick in military demand? I certainly hope not. End of the bear? Maybe it has been long enough after Fukushima that people see an undervalued commodity. There has been a significant rise in plans for new nuclear power plants. Anyone have any plausible fundamental analysis to add?
AMEX:URALong
by flyinkiwi10
10-Year Treasury Yield Trendline Breakout Faces Next TestThe 10-year Treasury yield confirmed a breakout under a near-term rising trendline from March, opening the door to reversing the uptrend since then. Rising concerns about a recession in the United States, also amid a general slowdown in global growth expectations, are pressuring bond yields lower. Ahead, the 10-year rate is facing the May low at 2.705 where the 100-day Simple Moving Average is fast approaching. The latter could still reinstate the dominant upside focus. Otherwise, more pain may be in store. Below is the 61.8% Fibonacci extension at 2.3667. Resuming the uptrend entails a push back above the current 2022 high at 3.497. TVC:US10Y
TVC:US10Y
by QM_Dubrovsky
How long could deflation last? What about bonds?As most commodities are currently collapsing, it is very hard to keep believe that inflation is going to go higher from here. June could be the first month with a negative MoM CPI print, but it probably won't be the last. As deflation is taking inflation's seat, bonds have been looking attractive for some time. Essentially we got a blow of top in yields (capitulation bottom in bonds), and now bonds are rallying. It's totally normal as bonds took out the lows, and are now showing major strength at a time where the dollar is strong, while commodities, stocks and real estate looking weak. The truth is that there is no escape from a major global recession. Commodities could fall a lot more until Central banks reverse course. There is too much debt and the only way to get out is by printing, while all the rate hikes will only eventually result in a crash. It's just that rate hikes have a delayed effect and most investors haven't realized what is coming yet. Is the inflation story over? I don't think so. We are just in a very a nasty recession, that could lead to a deflationary collapse. Essentially a liquidity crunch that would cause investors to capitulate, and then force the Fed to step in to save the system. There is no way the Fed will hike rates more than 0.5-1% from here, and there is no way the Fed won't be forced to cut rates and resume QE by June 2023. The bond market reversing like this is an indication that the Fed is about to make a mistake by raising rates once or twice in the next few months, as bond yields are already coming down. It's interesting that bond yields rose more than in 2018 before they reversed and fell below the Fed Funds Rate (FFR), yet FFR is currently 0.75% lower than when the Fed paused in 2018. Could easily see FFR getting down to 0 in the next 12-24 months as the financial system faces collapse yet again, but I don't see bond yields going as low as they did during Covid. What I see is long duration bonds going up to the key breakdown zone, around 130-135 on TLT or bond yields going up to 2.4-2.6% before moving higher again. Essentially I do see a major deflationary episode ahead, I do believe bonds can go up, I don't believe the Fed will ahead of the problem and that there isn't much they can do. However at the same time I don't believe that the inflation story is over, as I do see higher inflation coming once we are done with this episode. Why? Because a lot of production of stuff will go offline, while governments print a ton of money to save the system. Less goods, more money... No way inflation won't happen again. The debt bubble is popping and long term this is inflationary. So far we've seen bonds divergence from their long term trends, first with a blow off top, and then with a rapid decline that swept the lows. Could we get back into the main trend? It's possible, but I don't think so. All I see is a similar retest to what we go in 2021, where bonds broke down and then retested the breakdown level before going lower. TLT will fill the gap and then decide where it wants to go. Definitely wouldn't be surprised if bonds chopped in a certain area for a while, but ultimately I think we are going lower. Of course we could go lower even during a deflationary period, as everyone is liquidating whatever they can. If people need dollars, they will sell anything for them, including dollars. At the moment bonds are still very attractive, yet this doesn't mean that if people need cash they will hesitate to sell them.
NASDAQ:TLT
by BitcoinMacro
4
US Inflation is Nearing a Harmonic PeakIf we are to base our views of this chart like we would any other price chart, the harmonics we see forming here would imply that US Inflation is reaching a peak and that we will see Inflation come down signfiicantly over the the coming years. If i were to give a target i'd say we'd wanna see it come down to atlest 3% as a first target but it could go down even more depending on how tight things get. The smaller harmonic is a Bearish Butterfly with a reversal zone between the 1.272 and 1.618 and the bigger one if we get that high is a Bearish Shark. Ideally we'd like to see the Butterfly playout and us not to have to go as high as the Shark.
ECONOMICS:USIRYYLong
by RizeSenpai
5 Years of the Yield Curve 2018 - Flattening curve throughout the year with some slight inversion towards the end. 2019 - Complete inversion early in the year lasting awhile. Entire curve beginning to fall. 2020 - COVID Fed response slams the short end to the ground with the longer end having a pretty muted reaction. 2021 - Curve starts to stretch with short rates being extremely low and long rates showing pretty strong upside. 2021 - So far, the short rates have become unhooked from the 0 line and launched towards long rates. The curve has inverted again and there are no signs of slowing on the short end.
TVC:US01Y
by Seth-Goldberg
When this trendline breaks, Japan may hyperinflateJapan's central bank is buying unlimited amounts of Japanese debt in order to maintain yields around 0.25%. This ratio shows yields over the central bank's balance sheet. When this trendline breaks to the upside, it essentially means that Japanese debt is being sold faster than the central bank can buy. Japan may be going through some serious financial events very soon. www.cnbc.com The bank of Japan is selling US treasuries in order to buy more Japanese treasuries. This may cascade into US problem of rising interest rates and unsustainable debt levels being that Japan is the largest foreign holder. www.bloomberg.com
TVC:JP10Y
by rrmhearts
Dead Cat Bounce for Bonds?Bonds have pressed higher following the Fed's 75bps rate hike. We have broken out of 115'29 back into the 116 handle, topping out at our level at 116'20. A red triangle on the KRI suggests that we are facing resistance here. We do appear to be seeing a bull wedge consolidation pattern, but the Kovach OBV has leveled off, so it is likely we will fall from here. Watch 115'29 or 115'03 for support. If we are able to break out further, the next target is 117'08.
CBOT:ZN1!Short
by quantguy
US 10Y Treasuries Short Term BearishCurrently watching the 10Y Treasury Yield to hit resistance and pull back. 3% should be a big resistance level for now. Short term Fibonacci target of ~2.6%. This will be bullish for equities. The recent pivot low broke structure to the left, where the low in late April was broken. This is now a bearish retracement towards the highs, and will be watching for fib levels or a double top as resistance. The bigger picture monthly chart (below) shows a big supply zone resistance at 3%. This area of supply has been hit, and a further reaction to the downside expected. Also, the yield is stretched away from the monthly 21ema, with the 21ema currently below the 200sma. The stochastic momentum index (SMI) is also on overbought zone with bearish divergence.
TVC:US10YShort
by FourC
USDX Daily TA Cautiously BullishUSDX Daily cautiously bullish. *Equities are down, cryptos are down, commodities are down (yes Gold included), real estate/housing market down, inflation up and the US dollar (as well as Russian ruble)... up. The Fed is expected to announce anywhere from a 50bp-100bp rate hike this Wednesday if they want to be in line with their promise to go "beyond neutral" to ring in still growing inflation; 50bp would likely assuage markets in the short term and stall the dollar, whereas 75bp+ would likely send markets lower and keep pushing up the dollar.* Recommended ratio: 90% USDX, 10% cash. Price is currently in Discovery as it is currently printing a new ATH at $105.05 amidst a big push back into treasuries (10y/30y). Volume remains Moderate (high) and is currently on track to favor buyers for a fourth consecutive session if it can close in the green in today's session. Parabolic SAR flips bearish at $101.36, this margin is mildly bearish. RSI is currently breaking above 63.78 and is trending up at 68.60 as it fast approaches overbought territory. Stochastic remains bullish and is currently on the verge of testing max top (where it can potentially coast in the bullish "autobahn zone" for a while). MACD remains bullish for a second consecutive session and is currently trending up at 0.39, the next resistance is at 0.46; if it blows past 0.46, it will likely test the uptrend line from August 2020 at around 0.80 resistance. ADX is currently trending up at 23 as Price continues to rise, this is mildly bullish and becomes very bullish if it can maintain this same correlation above 25. If Price is able to continue in its Discovery, the next psychological level to watch for is $110. However, if Price retreats from here then it will likely test $103.77 support. Mental Stop Loss: (two consecutive closes below) $103.77.
PEPPERSTONE:USDX
by dailytaguy
Bonds Stabilize at LowsBonds have found support just above our level at 117'19. We appear to be forming a bear wedge, but the Kovach OBV is flat, suggesting we may range at current levels. After the precipitous decline from 121'00, it is likely that we will establish value in a sideways correction or even a relief rally, before another selloff. If we break down further, then 117'08 is the next level where we should anticipate support. After that, there is a vacuum zone to 116'20. A relief rally could take us as high as 119'01.
CBOT:ZN1!
by quantguy
Bonds Test Higher LevelsBonds have edged up higher, with ZN hitting our target of 121'00. This is a strong psychological and technical level. We are seeing a bit of a divergence between the price action and the Kovach OBV so unless more momentum comes thorugh, anticipate a dip or some ranging between 120'14 and 121'00. If we dip further, 119'23 should provide support. If we are able to break out further, then we have a fairly wide vacuum zone to the next level and target at 121'28.
CBOT:ZN1!Long
by quantguy
Bonds Pick UpBonds have found support and made a run for higher levels. The ten year dipped 119'23 into the 118's, finding support just above our level at 118'04. We then saw a rebound to 120'14, which we have been identifying as the next target after 119'23. It will take some momentum to break this level however, since this is a relative high from back in April. We are already seeing steep resistance here confirmed by a red triangle on the KRI. The Kovach OBV is gradually trending up, but is a oscillating with the dips, suggesting we need to see more momentum to come through to sustain the rally. If we selloff further, then we should see support at 119'01 then 118'04.
CBOT:ZN1!
by quantguy
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
Japanese yen hits 20-year lowThe Japanese yen is slightly lower at the start of the week. In the Asian session, the yen fell as low as 131.35, which marked a 20-year low. The speed of the Japanese yen's depreciation has been remarkable, falling 12% against the US dollar in just three months. The formula for the yen's slide has been relatively simple - US Treasuries have been moving higher, while the BoJ has fiercely defended its yield control curve, capping the 10-year yield at 0.25%. Since the yen is extremely sensitive to the US/Japan rate differential, the dollar has pummelled the yen. Moving forward, the BoJ isn't about to change its stance and allow JGB yields to increase. The central bank is committed to an ultra-loose monetary policy and has been using debt financing, with the government's debt currently at a staggering 250% above GDP. This means it becomes a huge expense for the government if JGB yields move upwards. US Treasury yields continue to move higher, with the 10-year yield inching higher on Monday to 3.13%. The risk on USD/JPY remains tilted upwards, but the question is whether the BoJ will continue to sit on the sidelines and allow the yen to sink. Does the BoJ have a 'line in the sand' when it comes to the exchange rate? There had been talk of the 130-level triggering intervention, but that hasn't happened, as the BoJ and Japan's Ministry of Finance (MoF) have limited themselves to jawboning that they are monitoring the situation and are deeply worried about the yen's rapid descent. According to a BoFA note on Monday, 140 is a key line that could trigger yen intervention. The 140-level has held since 1998, and if breached, the MoF could respond and buy yen in order to stabilize the currency. In the meantime, the yen will likely continue to lose ground, with the Federal Reserve expected to continue to tighten at an aggressive pace. USD/JPY faces resistance at 1.3136 and 1.3218 Ther is support at 1.3000 and 1.2918
by OANDA
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
Opportunity to buy US Treasuries and a failing fiat system?The 2/10 treasury yield spread is approaching an inversion. All of the previous yield curve inversions were associated with catastrophic event many of which stemming out of a fiat monetary system that seems very obviously to be failing. We are seeing the failing fiat monetary system if we look at the amount of money being created out of thin air by the FED (and ECB, Bank of England, Bank of Japan). The FED is expected to raise interest rates at its May 3-4, 2022 meeting. More rate hikes are expected to follow, with the goal of reducing inflation. The markets anticipate that the federal funds rate will exceed 3% by early 2023. The dollar is showing great strength across other leading currencies. If you invest in treasury you can get a fair interest rate of 3% (and assuming with more rate hikes even more), as US treasuries bond are available at a great rebate. Do consider the currency devaluation possible if your base living currency is not the USD.
TVC:US10Y
by CarpeMomentum