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Us02yr

The (4) Four Charts I am watching closely todayPull these charts up on your radar. They are key. With today’s spike on the VIX, we may see key resistance and support lines break. If any one of these critical trendlines/levels are broken, much more caution is warranted on the long side. Let’s quickly run through the charts I am observing. DXY - A break to the upside of that macro uptrend (with confirmation on the daily) indicates a stronger dollar. A stronger dollar price must be calculated into current stock prices, weakening the current stock momentum. US500 - Testing that Macro Uptrend as support. A break below may indicate further downside (pending FED language following FOMC press conference). US Treasuries - Both the 10 year and the 2 year are pushing up against resistance. A break to the topside would indicate that the FED will continue its aggressive rate hikes strategy to tackle inflation. The dollar will follow with strength. The markets will depress even further. Crypto will follow. Treasuries seem to indicate that the FED will continue its aggression against inflation. We must pay attention closely to those purple lines/levels. Also to note, Bitcoin is up against its 200-week ma. I don’t see that be broken immediately without some setback prior. The Bitcoin price battle with the 200 weekly ma may be the earliest indicator we have to what might follow in the next few days/weeks. As always, be cautious. Don’t bite too hard on these last few weeks of bullish price action. Dollar-cost average yourself in. Place those stops. And best of luck to you all! Stew
TVC:DXY
by stewdamus
US 10's mins 2's for Dec 2nd, 2021The yield differential between two-year and ten-year US Treasury notes, known as the 2s10s spread, has reached its highest level since November 2015. The 2s10s spread, which describes the slope of the yield curve, receives a lot of attention from market analysts and has arguably been a strong indication of economic mood and expectations. Historically, a steep yield curve indicates that investors are pricing in robust economic growth. When the 10-year yield is higher, investors do not purchase Treasuries, signaling that inflation expectations are high. It would also imply that investors anticipate the Federal Reserve Bank of the United States setting a higher benchmark interest rate than the existing one. In contrast, a flat yield curve indicates that long-term inflation expectations are modest. As a result, slowing economic activity and outperformance of fixed income assets are predictable outcomes. A yield curve inverted by 2 x 10 s implies the risk of a recession. In fact, the inversion of the yield curve, which happens 6–24 months before the economy falls to the point of technical recession, has forecasted every recession since 1955. The 10-year rate has risen sharply, breaking through a barrier level that had been in place since March 2020, fueling the steepening in 2:10. The rising 10-year rate, which is frequently used as a proxy for the risk-free rate in net present value calculations, has weighed on risk assets while driving the dollar higher as investors flock to risk-free 1.6 percent US Treasury notes. The US dollar index, DXY, has already broken through many resistance levels and is approaching its 200-day moving average of $92.9. DXY may be destined for a fall since the price has surged two standard deviations over its 21-day mean. The SPX has given up all of its gains from February and is now looking for support. According to the daily chart, the current spread on the 2s10s yield curve is close to 1.37 percent (2-year yield is 0.16 percent and the 10-year is 1.53 percent ). Since October 2020 , the pair has been heading upward. Prices have found support largely between the 8-day and 21-day EMAs, with a few dips to the 34-day support level, suggesting a strong rising trend. Furthermore, prices have been testing and smashing the upper Bollinger Band resistance level on a regular basis. Technical indications suggest a continuation of the 2s10s yield curve's upward trend, with the chance of consolidation before a rise higher. We predict the USD will climb if the positive trend continues, placing pressure on risk assets like gold.
TVC:US10Y
by TayFx
ridethepig | US02Y Market Commentary 2020.02.25Play may go as far a 1.115%. A counterattack from FED needed to save Equities... BTFD always wins? Not this time...When major forces on both sides come together, it comes down to a sort of exchange case 1, which we shall call: " Selling life as expensive as possible " Buyers play ... Sellers happy to exchange at the resistance line, but since FED is condemned to death, it is quite understandable for those wanting to sell Bonds are the highest price possible. Generally speaking, such a telegraphed move is much stranger to the novice than an experienced: Virus worries and Japan confirming recession is trigger a move in vol, and it makes the US05Y-US02Y attractive. Treasuries will outperform for the coming months, Equities will remain soft until later in the year. Hesitant to build full sized positions till we have a technical break as we are aggressively outguessing the next move from FED. As usual thanks for keeping the support coming via likes and comments! Jump in with your charts below!
TVC:US02YLong
by ridethepig
ridethepig | US 2s10s Curve Breaking HigherI have been talking about the curve steepening for some time after we cemented the lows. From a technical perspective, the breakout is implying a test of 60 over the coming weeks and months. The US 2s 5s Bond Curve also looks to be triggering a major break up: This will reflect a medium term breakout with large forces clashing against each other and diverging at the prior lows in a long-term swing. A mixture of profit taking and momentum tiring. A break above is triggering the flows, with next key levels in play at 35.5bps, 49bps and 60bps as the final target. US10Y DE10Y As usual thanks for keeping the support coming with likes, comments, questions and etc! Feel free to jump into the conversation in the comments with your views/charts.
TVC:US10YLong
by ridethepig
ridethepig | US 2s5s Curve Screaming Recession in 2020A timely update to the 2s5s US Curve which is breaking higher with the resteepening after flattening from 2016. This breakout indicated we have marked a meaningful base with the next target in play at 29bps which is the measured target from a breakout. (1) Every other time this happened it ended badly for the global economy via recession. (2) A Fed that lags and finances the Whitehouse will only add fuel to the flames... "it's different this time". (3) The longer the delay in USD devaluation from Fed, the worst the blow is going to be in Equity markets. Assuming USD does not devalue materially into 2020 its repo will grow and continue expanding the balance sheet , one way or another eventually this is going to look like Fed has been financing the WhiteHouse and then the game is up. For those tracking the renewed steepening there are plenty of opportunities if you know how to capture the symmetry; for example Banks outperforming was a no-brainer: Defensives outperforming: Rotation in full swing: End of the Cycle? Smells like it... Recession is calling... Thanks for keeping all the support coming with likes, comments, charts, questions and etc! Best of luck those tracking for the end of the cycle... this chart will be one for the history books.
TVC:US05YLong
by ridethepig
2
FOMC Minutes Reveal Inflation Still a ConcernThe FOMC minutes are being released as I write this, but weak inflation seems to one of their key concerns. Expect the yield curve to continue to flatten as this gets priced into the long end. The spread between the US 30 year and Us 2 year has been careening off a cliff lately and given this news, it is safe to expect this trend to continue. The Kovach Chande indicator is solidly bearish, confirming this, and the lower bound of the Kovach Reversals indicator is continuously being pushed. If you want access to the Kovach Momentum Indicators, Reversals Indicator, or Crypto Specific Indicators, please sign up at quantguy.net!
TVC:US30YShort
by quantguy