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US10Y

US 10Y TREASURY: NFP implied yieldsFriday was the major trading day on the US financial markets, after the release of jobs data for August. The US nonfarm payrolls came weaker than market was expecting, which implied market higher volatility. The nonfarm payrolls came at the level of 142K, while the market was expecting to see 160K for the month. On the positive side was a modest decrease in the unemployment rate from 4,3% to 4,2% in August. Such weak figures were an indication to markets that the Fed might need to cut interest rates at least by 50 bps in order to support the economy, which might be potentially entering into a recession. Of course, the US economy is still holding in a relatively good shape, where relatively weaker jobs figures should be taken with a reserve. The 10Y Treasury benchmark was pushed to the downside, reaching the lowest weekly level at 3,65% at one occasion at Friday's trading session. Still, yields are ending the week at the level of 3,71%. The week ahead will be used by investors to digest the latest jobs data and reassess their positions accordingly. In this sense some adjustments in yields are possible to the upside. The level of 3,8% might be tested for one more time.
TVC:US10Y
by XBTFX
Hmm... Something Interesting & Sweet is Brewing in T-Bond MarketIEF is a longer maturity, longer duration play on the US Intermediate Treasury segment. The fund focuses on Treasury notes expiring 7-10 years from now, which have significantly higher yield and interest rate sensitivity than the notes that make up our broader 1-10 year benchmark. IEF`s average YTM is significantly higher than US-T Aggregated benchmark's. Of course, the higher yield comes with significantly higher sensitivity to changes in rates, particularly those at the longer end of the yield curve (10-year key rate duration). The fund changed its index from the Barclays US Treasury Bond 7-10 Year Term Index to the ICE US Treasury 7-10 Year Bond Index on March 31, 2016. This change created no significant change in exposure. IEF's narrow focus and concentrated portfolio have been popular, so the fund is stable and easy to trade. The main technical graph represents IEF' Total return (div-adjusted) format, and indicates on developing H&S structure, as US Federal Reserve tight monetary policy seems is near to ease.
NASDAQ:IEF
by Pandorra
Head & Shoulders pattern: 10 year yield could drop to 2.87%The series of tops shaped notorious Head & Shoulders pattern on 10-Year Treasury yield (TNX). The tallest peak is the Head and Shoulders are on both sides. The Neckline is the support that is built through valleys of the Head. The price has breached the Neckline this summer triggering the pattern bullish scenario. The target is calculated by subtracting the height of the Head (from top to Neckline) from breakdown point on the Neckline. It is located around 2.87%. Almost 1% down from the current level
TVC:TNXEducation
by aibek
Gold predicting that Big falling rates cycle has almost overThere are several factors that can drive gold prices up in long term. Some of the key factors include: 1. Global Economic Uncertainty: Gold is often seen as a safe-haven asset during times of economic uncertainty or market volatility. Investors tend to flock to gold as a store of value when traditional investments like stocks and bonds are perceived as risky. 2. Inflation: Gold is often used as a hedge against inflation. When inflation is high and inflation expectations are going even higher, the purchasing power of fiat currencies decreases, leading investors to turn to gold as a way to preserve their wealth. 3. Geopolitical Tensions: Political instability, conflicts, and geopolitical tensions can also drive up gold prices. In times of uncertainty or conflict, investors may seek the safety of gold as a reliable asset. 4. Central Bank Policies: The monetary policies of central banks, such as interest rate decisions and quantitative easing measures, can impact gold prices. While investors thoughts that lower interest rates and expansionary monetary policies tend to be supportive of higher gold prices are widespread, in reality - higher due to inflationary concerns interest rates are more supportive for gold prices. 5. Demand and Supply: Like any commodity, gold prices are influenced by supply and demand dynamics. Factors such as jewelry demand, industrial demand, and gold production levels can all impact the price of gold. These are just a few of the factors that can drive gold prices up. It's important to note that gold prices can be influenced by a wide range of economic, geopolitical, and market factors. The main Graph is an Annual chart for ratio between Gold prices in US Dollars (XAUUSD) and US Inflation (USCPI). In technical terms this graph indicates that 40-years deflationary plateau, and monetary cycle of falling USD rates has almost over, while due to mentioned above reasons, Gold can start its ride to outperform inflation within many upcoming years.
OANDA:XAUUSD
by Pandorra
US 10Y TREASURY: adjusting for a rate cutAfter Powell`s the “time has come” for the Fed to pivot, and the latest PCE data, markets were adjusting their expectations for the level of Fed's rate cuts in the coming period. The Julys PCE data came surprisingly lower from market expectations, of 2.5% on a yearly basis, compared to 2.6% expected by markets. At the same time, investors are considering both personal income, which was higher by 0.3% in July, and personal spending which was higher by 0.5% for the month. The 10Y treasury yields started the previous week around 3.78%, however, they are ending it at 3.90%. Highest weekly level was 3.92% on one occasion. The week ahead might also trigger higher volatility. The Non-farm Payrolls and Unemployment Rate for August are scheduled for a release, where any surprises might induce higher market moves. However, at the current point, there is some probability that the level of 4.0% might be tested, but not higher grounds. There is also a potential for a short reversal, but not too lower from current levels.
TVC:US10Y
by XBTFX
US 10Y TREASURY: “time has come” for 25 or 50 bps?The “time has come” for the Fed to pivot. This was the note from Fed Chair Powell at the Wyoming Jackson Hole Symposium, and was the note that the market was waiting for a long time to hear. Current market expectation is that the Fed will make its first cut in September, however, the question that is currently occupying Wall Street is whether it is going to be 25 or 50 basis points? Fed Chair Powell did not make any comments on when the rate cut will happen or what would be the scale of the rate cut. The 10Y Treasury benchmark started the week around the level of 3,9%, and ended it at 3,79%. The market has priced the first rate cut in the coming period, as announced by Powell. During the week ahead, there might be some lower volatility between 3,8% and 3,9%, however, on a long run, the yields will certainly eye the downside.
TVC:US10Y
by XBTFX
US10Y going lower with the Fed having no choice but to cut.Almost 10 months ago (November 7 2023, see chart below), we made a bold (for the time being) call on the U.S. Government Bonds 10YR Yield (US10Y), as against the prevailing market sentiment we gave a sell signal, right after what turned out to be a top: Today's revisit to this pattern shows that the 1M RSI Lower Highs have already started to form a Bearish Reversal on the US10Y price, similar to 2006 - 2007. We are expecting to hit the 0.382 Fibonacci retracement level at 2.100% as its first Target, on the Fed's first wave of rate cutting and gradually hit the lower Fib targets as the rates stabilize. For better illustration we have plotted also the U.S. Interest Rate (red trend-line), where you can clearly see that the fractal we compare to today, is right before cuts started in August 2007. Also it is a natural consequence of US10Y falling when rate cut cycles start, evident also in June 2019, December 2000, May 1995, May 1989 September 1984, May 1981 etc. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
TVC:US10YShort
by TradingShot
1
JPY, key to all other indexesJPY vs USD, key to the other index developments. As long as it holds its trendline, JPY will remain week vs the other global currencies, Japan exports will hold, carry trade arbitrages won't unwind, US bonds will not sell off (rising yields), volatility will remain contained. But if it breaks and doesn't hold the 139JPY/$, we could witness how algos start dumping US and Euro shares and bonds. Rising JPY should also affect the Nikkei 225, retaking the path to 30k
Short
by j_arrieta
2
US 10Y TREASURY: Fed`s cut is nearingThe posted US inflation for July brought some new confidence for investors that the Fed's rate cut is nearing. The July inflation eased to the level of 2.9% on a yearly basis, and was below market forecast of 3.0%. The Producers Price Index was another indicator which pointed to further easing of inflation pressures, by reaching 0.1% in July, for the month, again below market estimate of 0.2%. To nail the market expectations, preliminary Michigan Consumer Sentiment, posted on Friday, showed no change in inflation expectations for the five years period of 3.0%. This was enough information for the market participants to increase their expectations that the Fed might make their first rate cut in September. The 10Y US Treasuries started the week modestly below the level of 4.0%, and were driven to the downside during the rest of the week. Yields reached the lowest weekly level at 3.8%. Thursday and Friday brought back some short volatility, after the Retail Sales data were posted, however, yields are finishing the week at the level of 3.88%. During the week ahead the Jackson Hole Symposium will be held on Thursday and Friday. After the symposium, Fed Chair Powell will hold a speech, which might bring back some volatility to the market, considering current nervousness around rate cuts. Still, it is not expected that the yields will move significantly to either side, except to test, for one more time the 3.8% level.
TVC:US10Y
by XBTFX
US 10Y TREASURY: easing with rate cutsTwo weeks ago markets reacted to surprising jobs data in the US, however, the posted ISM Services PMI on Monday put a dose of relaxation among market participants. Data showed that the US is clearly not in a recession and that, at least, the services sector is doing fine at this moment. All financial markets were traded in a positive manner during the previous week, resetting their sentiment to the previous path. The US Treasuries also re-adjusted during the week, in a move from 3.7% reached on a Monday, till 4.0% reached on Friday. The 10Y benchmark is finishing the week at the level of 3.94%. Regardless of a positive come-back and re-assessment of the current state of the US economy, the market nervousness might continue in the coming period. It should be considered that the US inflation data and the retail sales for July will be published in a week ahead, where some increased volatility might be possible for one more time. At the current stage, the market is testing the 4.0% level, however, there is some probability for another drop in the week ahead. The level of 3.9%, eventually 3.8% might be tested. The move above 4.0% is unlikely at this moment.
TVC:US10Y
by XBTFX
US 10Y TREASURY: September?During the previous week the 10Y US benchmark rates reached the lowest weekly level at 3.78%, and moved down from the support line at 4.2%. There are two major reasons for such a strong drop in Treasury yields. The first was on Wednesday when Fed Chair Powell noted a potential for a rate cut in the future period, which market perceives to be September`s FOMC meeting, and the second reason was surprisingly weak jobs data posted on Friday. The posted non-farm payrolls for July were significantly weaker from market expectations, reaching 114K, from 175K expected by the market. At the same time, the unemployment rate reached 4.3%, again higher from 4.1% estimated by the market. There is currently fear among investors that the US might slip into recession, however, there are also analysts who are noting that weak figures might be due to seasonal effects. Surprisingly weak jobs data led investors to increase odds for more than one rate cut during the course of this year. Also, there is currently 58% chances by market expectations, that the Fed will cut rates by 50 basis points. After such a strong move in Treasury yields, it could be expected that the market will slowly digest the Friday`s data and adjust positions accordingly. In this sense, there is a probability that the yields would revert a bit to the upside, at least to the level of 3.9%. However, at this point levels around 4.0% are questionable.
TVC:US10Y
by XBTFX
Money Market says that rate cut will be an urgent one (again)Just take a look on a rate cut expectations. In a short, the main technical graph is a difference (spread) between the nearest futures contract on FOMC interest rate (in this time Sept'24 ZQU2024) and the next one futures contract (in this time Oct'24 ZQV2024). It's clear that spread turned to negative in 2024, and heavily negative over the past several weeks. Historical back test analysis says that in all of such cases, FOMC is to cut interest rates immediately. The next scheduled FOMC meeting is September17-18. Will the market wait 6 more weeks? The right answer: NO. Rate cut will be an urgent one (unscheduled again).
CBOT:ZQ1!
by Pandorra
🔜 20+ Year Treasury Bond Market. Perhaps This Is The End US stocks surprised much of Wall Street this year with a strong run that defied decades-high interest rates and recession calls. The rally was fueled by slower inflation and hype over artificial intelligence. But more recently, the Federal Reserve's unwavering higher-for-longer rate stance and a deepening bond-market rout have had a sobering effect on equities sentiment, with the S&P 500 index halving its year-to-date gains. Indeed stock valuations are looking increasingly stretched, raising the risk of a correction. One such indicator in particular is flashing RED - the relative valuation of stocks versus the debt market. SPX / ICE BofA Corporate Total Return Index In August this year, the S&P 500 CBOE:SPX climbed to levels last seen during the peak of dot-com boom, relative to an index that tracks the US corporate bond market. The gauge is still holding near those highs, despite the recent pullback in equities. The metric last surged this high in the spring of 2000 — and that was followed by a multi-year meltdown in stocks that saw the S&P 500 crash 50% between March 2000 and October 2002. SPX 50% Decline During 2000-2002 Another indicator that shows the richness of stocks relative to debt is the so-called equity risk premium — or the extra return on shares over government debt, which is considered a safer form of investment. The metric has plunged this year lows unseen in decades, indicating elevated stock valuations. "Equity risk premium is near its worst ever level going back to 1927. In the 6 instances this has occurred, the markets saw a major correction & recession/depression - 1929, 1969, 99/00, 07, 18/19, present," research firm MacroEdge said in a recent post on X (ex-Twitter). The so-called equity risk premium (earnings yield minus bond yield) recently fell to a new cycle low and remains well below historical averages. In other words, the stock market has become more expensive relative to the bond market despite the recent pullback. Meanwhile the main graph (quarterly Div-adjusted chart for NASDAQ:TLT 20+ Year Treasury Bond ETF) illustrates perhaps right there could the end for U.S. Govt Bond Market decline, with Double top as a further projected/ targeted upside price action. Will all of that bring U.S. stock market to 50% decline like in early 2000s!? Time will show!
Editors' picks
NASDAQ:TLT
by Pandorra
40
US 10Y TREASURY: the FOMCDuring the previous week markets full attention was on PCE data which were published on Friday. The PCE index rose 0.1% for the month, and 2.5% on a yearly basis, which was fully in line with market estimates. The evident slowdown in inflation in the US increased the probability that the Fed might make the first cut in September this year. The 10Y US benchmark yields were reflecting the investors sentiment during the week, moving from 4.3% at the start of the week, and ending it at 4.19%. As the FOMC meeting is scheduled for the week ahead, some increased market volatility is quite expected. Market is not expecting that the Fed will cut rates during this meeting, however, any change in rhetoric of the Fed Chair Powell might trigger higher market volatility. At this moment, there is a high probability that the market will test 10Y yields for a potential for lower grounds from the level of 4.20%. Some short move to the levels above 4.20% is also possible, but these levels are not expected to hold for a longer period of time.
TVC:US10Y
by XBTFX
MidCap vs. LargeCap. Technical & Fundamental Levels to WatchThe Russell 2000 trailed the S&P 500 significantly in 2023, gaining about 17% compared to a gain of about 24% for the large cap index. That underperformance has spilled over into 2024. As of July 10, 2024 the Russell 2000 YTD is about Zero compared to a 17.75% gain in the S&P 500 (SPX) and 23.50 gain in Nasdaq Composite Index (IXIC). By the way, that valuation measures make the small cap Russell 2000 index much more compelling when compared to the S&P 500. Small caps relative to the S&P 500 on a price-to-book basis is back to where it was in 1999. As of June 30, 2024 small caps price-to-book (P/B) ratio is 2.10, as it described on FTSE Russell 2000 Index Factsheet, while Total US Market (Russell 3000) P/B ratio is 4.42. I'll be brief. Perhaps it will be the briefest brief over the past ten god years I'm here on TV. DON'T MISS IT, AS IT ONE PER LIFE OPPORTUNITY. The main technical graph is ratio between RUT (Russell 2000 Index) and S&P500 Index, and it back to support that was never seen over the past 25 years, since March 1999. What's happened with market at these times? ⭐ Nasdaq Composite Index doubled in price over the next 12 months (March, 1999 - March, 2000), than turned 4x down. ⭐ S&P500 Index printed +20 per cents (March, 1999 - March, 2000), than turned 2x down. ⭐ March 1999 was the absolute low and was a launch point of 12 years of outperformance for Small caps vs Large caps. Will history repeat itself..? Who knows... But personally I believe - Yes, it can.
TVC:RUT
by Pandorra
US10Y yield to 8%+I know most people don't think this is a possibility, but I think it's highly probable. I think we'll see the US10Y break the recent highs and head to 5.59% as the first target to the upside. Then I think we'll continue the bullish trend and end the bullish move in yields at 8.13%, I think at that point, that's when you'll want to go long risk for the long term. I think shorting the 10yr and 20yr bonds, might be a great trade over the next 6 months. I think the start of the move might take a little bit to play out, but should really gain steam from March onwards. Let's see what happens over the coming months.
TVC:US10YLong
by benjihyam
3
US 10Y TREASURY: waits for PCE dataAs there has not been currently important macro data posted during the previous week, the investors were weighing comments from Fed officials on a potential course of action when interest rates are in question. In this sense, Mary Daly, Fed President of San Francisco, noted her hopes for more data which would indicate that the inflation is on its way to the 2% target. She commented on some good progress in this direction, but concluded that “we are not there yet”. Fed Governor Christopher Waller also commented on the potential for rate cuts in a similar manner. Fed Chair Powell should also be mentioned in this context, as he noted that the first rate cut will occur before the inflation reaches the 2% target. The 10Y benchmark Treasury yields continued to trade with a downtrend during the first half of the week, reaching the lowest weekly level at 4.14%. The second half of the week they reverted a bit to the upside, ending the week at the level of 4.24%. The US PCE data are set for a release during the week ahead, which would most certainly bring some higher volatility to the Treasury yields. As per current charts, there is some probability that the level of 4.3% could be tested, however, the long term perspective of the yields is to the downside.
TVC:US10Y
by XBTFX
US10Y Expecting a bullish reversal at the bottom.The U.S. Government Bonds 10 YR Yield (US10Y) initially expanded but then took a breather on the new Bullish Leg, as per our January 24 (see chart below) buy signal, before hitting our Target: The price is now approaching the bottom of the 2-year Channel Up yet again and by next week a 1D Death Cross will be completed. The 2 previous such formations within the Channel Up, have both been made right on its Higher Lows. As a result, we consider this a great bullish opportunity for the medium-term. Our Target is intact at 5.000%. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
TVC:US10YLong
by TradingShot
Shelter Inflation. The Tail That Wags The DogInflation is finally cooling off as inflation gradually loosened its grip on Wall Street and the economy in 2023, raising hopes for a gentler Federal Reserve and further gains for the market in 2024. Stocks rallied to their best 9-weeks stripe over the past 20 years in November and December, 2023 (so-called 'Santa Rally') as investors raised their bets that the Fed is done hiking interest rates to fight inflation. 6Mo USCPI Inflation was at its lowest levels since Covid-19 pandemic in early 2023 Top 4 U.S. stock market Indices were in rally in 2023 The economy has cooled under the weight of rising interest rates, as the central bank intended, but remains surprisingly resilient. Energy prices are down. Food prices are mellowing out. But the cost of having a place to live is still rising much faster than just about every other essential. U.S. Consumer Price Index inflation Headline inflation was up 3.1% from a year ago, and so-called "core" inflation, which excludes volatile food and energy prices, was up 4%. But the cost of shelter, which is the biggest component of the basket of goods the BLS uses to measure the cost of living, was up 6.5%. "The shelter index was the largest factor in the monthly increase in the index for all items less food and energy," read the Bureau of Labor Statistics report accompanying the latest data on consumer prices. "The shelter index increased 6.5 percent over the last year, accounting for nearly 70 percent of the total increase." When the covid-19 pandemic hit, the cost of housing surged as those who could afford it sought out bigger homes and many city-dwellers transitioned to the suburbs. What goes into Consumer Price Index That and a glut of savings unhindered by low interest rates combined to exacerbate what had been a long-simmering Housing crisis the U.S. But now that baked-in price hikes and rising mortgage rates spurred by tightened Federal Reserve monetary policy have put a bit of a damper on things, the housing market is also starting to cool. U.S. Single Family Home Prices in "Bubble Mode" 30Yrs Fixed Mortgage Rate is at 20Yrs Highs. 30Yrs Mortgage Annual Payment U.S. Single Family Home, only Interest. Housing prices tend to be “much stickier” than most costs, which means that when they rise we feel it more - and for longer (read - "for ever"). Housing prices do not compressed like just baked iPhone or iMac later in few years of its release. - Does all af that mean that pre-covid levels of relative housing affordability are coming back? - Sure "No". But at least American wages, which are still rising faster than before the pandemic thanks to increased worker power, will have a little chance to make up some lost ground. The issue is still Federal Reserve' lagged tightening policy, that is "The Tail That Wags The Dog".
FRED:CUSR0000SAH1
by Pandorra
How to break the marketsIn a fortunate turn of events, inflation has calmed. For equity bulls, more good news. Yield rates have probably peaked. To stop inflation, you must cool down a HOT economy. Overconsumption tends to increase prices. In an unfortunate (?) turn of events however, the markets haven't calmed down. Some charts suggest that the markets haven't felt at all the decisive rate-hike schedule. A question arises: Are markets so strong not to feel current yield rates? Or is there some kind of lag we must take into account? When will equities suffer, and how much? These are important questions right now that need serious answers. A custom indicator was invented to calculate the average-rate-of-return of equities against yield rates. It attempts to answer the following question: How much better do equities perform YoY against the "safe" US 10-year bond investment? Some interesting charts come up from this analysis: In 1951 yield rates broke out of their long-term bear market. At the same time, the equity market exploded in even higher strength. Note that at that period, equities managed to perform better than the ever-increasing yield rates. It was after yield rates ~tripled that problems arised. Moving to today, we only recently witnessed a breakout in the equity and the yield-rate-schedule. Judging from the '60s, we could even witness a decade of yield rates trying to catch up to the equity market. A simultaneous breakout can make sense. A massive amount of money has flown out of the bond market and had to enter the equity market. Equities may be forced to grow, for now. An incoming drop in yield rates from a pause in the rate-hike-schedule will almost certainly create an outflow from equities and back into bonds. Be prepared. The weakness in the equity market hasn't showed up yet. At any point, the steep upward trend can collapse. A crash will certainly come. But at a time when nobody expects it to. Remember, rates of ~7% managed to break irreversibly the equity market back in the '60s. Ask yourself and wonder. How tight of an economy can opportunistic equities handle? At what point will stability become more important for us than growth? Tread lightly, for this is hallowed ground. -Father Grigori
SP:SPX
by akikostas
3