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Invertedyield

Lower inflation do not mean things will become cheaperLower inflation and interest rates do not necessarily mean that prices will decrease. If I annualize the inflation numbers instead of focusing on the monthly figures, the overall picture becomes much clearer. 2 and 10 Year Yield Futures Ticker: 2YY, 10Y Minimum fluctuation: 0.001 Index points (1/10th basis point per annum) = $1.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
ECONOMICS:USIRYYLong
by konhow
7
Inverted Yield of 2022 Explained - Till TodayFor our housing loan, many of us, if you are in your 30s today and all the way to 70 years of age, will likely have chosen floating or short-term loan rates rather than longer-term loan rates. However, everything changed in 2022. Now, we are more likely to choose longer-term loan rates over floating rates. Why? Because today, longer-term loan rates are lower than floating rates. This phenomenon is called an inverted yield curve. In the 70s and 80s, there was also a period of inverted yields, and different markets moved accordingly as expected. Today, we are seeing an inverted yield once again, and the same markets are moving in a manner similar to those in the 70s and 80s. We will do a comparison between the 70s and today’s inverted yield. Please let me know what opportunities you see after this tutorial. 2 Year Yield Futures Ticker: 2YY Minimum fluctuation: 0.001 Index points (1/10th basis point per annum) = $1.00 10 Year Yield Futures Ticker: 10Y Minimum fluctuation: 0.001 Index points (1/10th basis point per annum) = $1.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
CBOT_MINI:2YY1!Long
by konhow
2
Yield curve is inverted today - Its implication and attributeWe have an inverted yield curve today - When the near end yields or interest rates is higher than the far end, we have an inverted yield. What is its implication and any attributes? To understand the implications of an inverted yield curve, it is crucial to know what a yield curve is and how it works. A healthy yield curve – It shows the relationship between the interest rate and the time to maturity of the bond. A normal yield curve slopes upward, meaning that long-term bonds have a higher yield than short-term bonds. This upward sloping curve indicates that investors demand a higher yield to hold longer-term bonds, as they are taking on more risk by locking up their money for a longer time. An unhealthy or inverted yield curve – However, an inverted yield curve occurs when short-term yields are higher than long-term yields. This situation indicates that investors are willing to accept lower yields on longer-term bonds, which is an indication of their pessimism about the economy's future growth prospects. Essentially, investors are willing to lock up their money for an extended period, accepting a lower yield, because they expect economic conditions to deteriorate. Its implication – i. It is a reliable predictor of an upcoming economic recession. This phenomenon has been observed many times over the years, and every time an inverted yield curve has occurred, a recession has followed. The reason for this is that an inverted yield curve indicates that investors are losing confidence in the economy, which can lead to decreased investment and spending. This, in turn, can lead to a slowdown in economic growth, which ultimately results in a recession. ii. Another implication of an inverted yield curve is that it can make borrowing more expensive for certain individuals or companies. Banks typically borrow at short-term rates and lend at long-term rates, earning a profit on the difference between the two. However, an inverted yield curve makes this process less profitable for banks, and they may become less willing to lend, resulting in a tightening of credit conditions. Attribute – Short-term fixed deposit saver. ie. Keep rolling your 3-month fixed deposit saving or traders trading into the expected volatility. In conclusion, an inverted yield curve, where the current Fed fund rate and 3-month yield is higher than the 30-year yield, is a rare occurrence in the bond market that has significant implications for the economy. It is a reliable predictor of an upcoming recession and can result in higher borrowing costs for some individuals and companies. Investors should be aware of this phenomenon and take it into account when making investment decisions. Some reference for traders: Micro Treasury Yields & Its Minimum Fluctuation Micro 2-Year Yield Futures Ticker: 2YY 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 5-Year Yield Futures Ticker: 5YY 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 10-Year Yield Futures Ticker: 10Y 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 30-Year Yield Futures Ticker: 30Y 0.001 Index points (1/10th basis point per annum) = $1.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
CBOT_MINI:2YY1!Long
by konhow
Inverted Yield Curve Starts in 2023 - Explained When the yield of the 3-month bond is higher than the 30-year bond yield, this is known as an inverted yield curve. It is a rare and unusual occurrence and we are seeing this today. This signals a potential economic recession in the future. An inverted yield curve suggests that investors have a pessimistic outlook for the future of the economy. They are willing to accept lower yields on long-term bonds because they anticipate a slowdown in economic growth. In contrast, they demand higher yields on short-term bonds because they expect the central bank to raise interest rates in response to inflationary pressures. An inverted yield curve can lead to a decrease in borrowing and lending activity, as it can make it more expensive for businesses and consumers to borrow money. This can result in a reduction in economic growth and can eventually lead to a recession. Some reference for traders: Micro Treasury Yields & Its Minimum Fluctuation Micro 2-Year Yield Futures Ticker: 2YY 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 5-Year Yield Futures Ticker: 5YY 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 10-Year Yield Futures Ticker: 10Y 0.001 Index points (1/10th basis point per annum) = $1.00 Micro 30-Year Yield Futures Ticker: 30Y 0.001 Index points (1/10th basis point per annum) = $1.00 Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
CBOT_MINI:30Y1!Long
by konhow
Inflation on 20 years "Borrowed Time"Gold started its rally since 2000. Whereas inflation and interest rates remain low since 2000. Reason for the "Borrowed Time"? Because easy money policy was needed to create: 1) An increase in money supply 2) By lowering its interest rates Purpose for easy money policy? 3 major events after 2000: 1) Middle East War 2) Subprime crisis 3) Covid-19 rescue plan (it tipped in 2020) The after effect of the accumulated easy money policy seem to be at its beginning. Meaning more upside for inflation and interest rates. Meaning Gold to continue its upward momentum. For traders - 3 types of gold for trading: • COMEX Gold 0.10 per troy ounce = $10.00 • E-mini Gold 0.25 per troy ounce = $12.50 • Micro Gold 0.10 per troy ounce = $1.00 See the video version below Disclaimer: • What presented here is not a recommendation, please consult your licensed broker. • Our mission is to create lateral thinking skills for every investor and trader, knowing when to take a calculated risk with market uncertainty and a bolder risk when opportunity arises. CME Real-time Market Data help identify trading set-ups in real-time and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
COMEX:GC1!
by konhow