Usbondyield
Can higher projected US02Y impact GOLD price ?TVC:US02Y has been trading to attractive levels fibonacci levels of 50% resulting in formation of bullish flag. Price is projected to go to 5.5% according to flag pattern. Recent NFP had higher than expected unemployment claims. Will this scenario attract investors to buy more bongs ?
What do you think will be impact of bullish bonds yield to the price of GOLD ?
Short-Term Rebound for DXY means Good Moment to BUY Gold!Last night, dollar get underpressure along with another pressure on bond yield. The technical moves as what I share last night.
So, we update the condition.
Dollar and Bond Yield have to retest the resistance before get another pressure. Therefore, Gold will have some correction on short-term. But, the good news is "correction means good momentum" to look forward the "cheaper" price to buy gold.
As long as support trendline at 2070 doesn't break, you still have another chance to buy gold.
Put the Stop Loss below the trendline support or below the historical low 2062. While the target expected at 2093 or 2109.
What do you think ?
US10 years Bond Yield probably "peak". 10/Nov/23US Bonds probably the "Most Highly Bought Bonds" by any Countries's govermnt in the world (as safe haven). Time to buy US Bond ETF? E.g TLT, AGG, IEF etc?. What do you think saving money in US FIXED deposit bank aiming for 5% +/- gain ( while waiting for US dolar depreciate against most currencies pair) or buying US Bonds ( which is the inverse of US Bonds Yield ) or GOLD!? ( I Prefer Gold).
Did the 10 year yield break in 2008?Good day Traders and investors,
The 10 year yield on the 6 month chart. This is the entire history on one chart.
What is going on with the 10 year yield? It is getting very, very volatile. It all started in 2008 with the financial crisis just looming around the corner. At the same time it broke the .236 on the Fibonacci sequence and has been diving ever since. That is until the next major crisis of the pandemic where is seems to have bottomed and took a strong bounce off a cliff dive. What does all this mean? did something break in 2008 like a lot of economist are saying? It's very possible. When we look at the chart, the 10 year yield compared to the last decade has been very stable. Even during the Volker years (late 70's early 80's) when interest rates spikes it barely made a move out from the norm and then rode the top of the trend as support for years until 2008. This volatility break out does look deferent and kind of scary. What will the volatility lead too, massive spike? or massive plunge? Could it also just bounce around sideways for years? What we have to keep in mind is, these are historically long-term trends. 20 to 40 years. Could this move up be a fake out? Yes, I think it's possible, however a fake out is on this chart 5 to 10 years, so it's of no major concern at the moment.
THE INDICATRORS
Right away, when look at the chart and the RSI, we see clear weakening and bearish divergence on the trend. We can see it playing out (bearish divergence) from 1968 to 1981, when the yield made a higher high but the RSI made a lower low. As we can see the divergence did play out, but it took almost 2 generations in 40 years. Also the ASO has been showing that the sentiment over the yield has been lessening over the years on the up swings and down swings, but it just had a major cross, so is that over now? Time will tell, a lot of it.
Touching on the Historical volatility again, we clearly see a sense of somewhat controlled or stable volatility for close to 100 years until 2008. Could this new volatility be the new trending range for the next hundred years? Possibly, if so, it shouldn't concern us. For now, we should just focus on the next 5 to 10 years and see what happens.
I have included a couple of scenarios in the chart. If the RSI gets rejected from this down trend, then yes, this is the chance that it could be a fake out move and then reverse and go lower. If volatility stays high and the trend is to go up for 20 to 40 years then I do believe the RSI would have to break this down trend. both of those in my opinions are scary, the 2nd one than the first. There is also sideways action for a decade and possible a cool down of the volatility before the next move, I would prefer this one, as it seems less scary to me.
THE FLUFF AND EXTRA
I think the yields being a fake out and go lower is the least likely scenario. However, (and here is the Fluff) my conspiracy mind has one scenario where this could happen. It all hinges and plays on CBDC's becoming a thing during this time frame. The theory is if CBDC's are introduced within the next 5 to 10 years then the yields could reverse, go back and make new lows at some point. The reason being is I don't think we can go negative yields without CBDC's. That doesn't mean it's a given if CBDC are implemented, it means the doorway would be opened for it. Remember, this is just FLUFF and opinion and means nothing.
Kind regards &
Have great day
Demetrios
BTC Vs US02US30 SPREAD - Interesting
• 2s30s spread : The US2US30 spread refers to the yield spread between the 2-year and 30-year U.S. Treasury bonds. The chart visualizes the difference, or spread, in yield for these two bonds over time.
The 2-year bond represents more of the short-term outlook, whereas the 30-year bond is more indicative of long-term expectations. So, when people refer to the US2US30 yield spread, they're essentially talking about the difference between short-term and long-term interest rates.
During typical economic conditions, investors demand higher interest for lending money over a longer period, thus the yield of 30-year bond is higher than the 2-year. However, during economic uncertainty, the spread can narrow or even become negative (also known as a yield curve inversion), which can be viewed as a potential indicator of a forthcoming economic recession.
Yield Curve:
1. A yield curve is a graphical representation of the yields available for bonds of equal credit quality and different maturity dates. It is used to measure bond investors' feelings about risk and can significantly impact investment returns.
2. Different types of yield curves can exist reflecting the short, intermediate, and long-term rates of various bond types, such as Treasury bonds, Municipal bonds, or corporate bonds of specific issuers.
3. The shape of the yield curve varies: a normal yield curve slopes upward indicating higher yields for long-term investments; a steep curve usually signals the beginning of economic expansion; an inverted curve suggests potential economic slowdown as long-term investors settle for lower yields; and a flat or humped curve indicates little difference in short and long-term yields.
4. The yield curve can help gauge the direction of the economy, serving as a predictor for potential turning points in the economy.
5. Yield curves allow bond investors to compare Treasury yields with riskier assets such as Agency bonds or corporate bonds. The yield difference between these is referred to as the "spread", which widens during recessions and contracts during recoveries.
#EURUSD next moveIn order to analyze EURUSD move we can use intermarket analysis as well, and as you can see for a past couple of month we have high positive correlation between EURUSD and TLT ( US 20 year treasury bond ETF).
Right now that price has been trapped in a rangy area for a Days, we can say for a breakout of any side we need to see confirmation from TLT as well. which means if price wants to create a Higher high and penetrate the high we need to see TLT create new high as well and goes above the arrow on TLT curve.
However, if TLT is unable to create new high but EURUSD does there might be intermarket divergence between these two assets and that perhaps could signal for a bearish divergence which can be followed by a downside reversal on EURUSD.
A third scenario would be that they both fail to create high and turn to the downside which in this case EURUSD chance to break to the downside is higher.
A lot of news can have impact on the movement of TLT like tomorrow unemployment rate but for sure the single most important one would be federal reserve fund rate which going to be announce on 14th of December , and if fed hike rates is lower than expectation that can bring TLT Higher and drive EURUSD Higher as well.
#US10Y #Bonds Can Fall From This FCP ZoneTraders & Investors, US 10 Year Bonds have been on the rise. After a minor correction they rose higher but now they could be approaching an FCP zone which can act as a resistance. We also have Relative Strength Index divergence setting up on weekly time frame.
Out this on your watch list as this can impact stock market, indices and other asset classes due to money flow from this asset class.
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USBONDS - Descending Scallop Examples US10Y on this daily timeframe shows a large descending scallop
On the right another example of this pattern is shown, however just it has been completed
Descending Scallops are a bullish reversal pattern
A Look at 30y US Bonds, Fed Fund Rate and InflationTreasuries are an intersting play right now. Depending on your home currencies it still might be a good moment to consider stocking up on them in your portfolio.
Couple of notes looking at the chart.
FOMC participants’ assessments of appropriate monetary policy: Midpoint of target range or target level for the federal funds rate was shown to be around 4% (per June 15 '22 Summary of Economic Projections).
The bond market had been signaling the need for FED fund rate hikes for some month already.
Looking at it from a EUR buying perspective you can currently get 30Y treasuries at around 3.3% (2.75 - 3% nominal plus slightly stronger EUR at the time of writing yield with an ~5% lower price still.
Forecasting a continued weak EUR and a top of the fund rate at around 4% these treasuries ought to be bound to rise latest in 2024.
Newly issued bonds ought to be reaching 4% soon. If so those will be attractive too.
It should be noted that there is no guarantee that the FED (nor the ECB) will be able to contain inflation or the starting recession.
The EU is likely to be hit harder for both.
That said the FEB may continue and we may end of up with much higher FED fund rate of above 4% (5%, 6%, .....).
This scenario seems unlikely as such high interest rates would break the financial markets and econimies.
It is to be noted that the FED's fund rate it approaching to be break a downward trend since 1984. On the chart the trend from 1988 has already been broken.
This chart does give some indications of the dependencies of these three key figures. But one can easily spot that it is not a clear when X goes up then Y does too.
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USDJPY Extremely Overbought, How to sell?We look at the USD/JPY and its driver the US Interest rate market. We talk about the key Y130 level that may Upset the Bank of Japan and Ministry of Finance.
Japan is historically one of the biggest FX interverners but the first step is always jawbowning (Official comments of concern about the Yen)
We looking for either that or data/comments from FED members to spark US yields to drop back from the boil.
Looking for 100-200 point correction once it begins.
US Government Bond Yield's Are Speaking But No One Is ListeningWe are clearly seeing Bond Yields tightening at an unprecedented rate. What is so interesting about this is that historically, yields have been driven higher by the FEDs Fund Rate, but Powell merely did a 0.25% hike on March 16th.
Bonds have already priced in rates at 2.5% and coincidentally this was the same rate (2.5%-3.0%) that drove the market into "Volmageddon".
Here is the 30-Year Fixed Mortgage Rate Average in the US, which paints a very similar picture. This is usually when the Housing Market really starts to get affected. It has already seemingly broken resistance. Deviating from the trend.
CPI data for March will be coming and its significance can't be understated because this will reflect the impact of the sanctions the United States put on Russia. As well as further commodity data.
One thing I have yet to see anybody acknowledge is the unprecedented rise in fertilizer. Please understand how vital fertilizer is to every country in the world. Without it or even a deficiency would send the world spiraling from lack of food. If prices are too expensive for farmers to meaningfully harvest every year, the market MUST accommodate.
Bonds have a rich history of telling the real story while the FED sings like a dove. Powell has recently been Hawkish but most investors believe he will flip dovish when the time is right.
The Bond market is again, telling us the total opposite.
Just recently Powell was asked, "Are you prepared to do what it takes to get inflation under control?" to which Powell responded, "I hope history will record that the answer to your question is Yes".
Usually, the common narrative is, "don't fight the FED". Well, why does everyone seem like they are fighting the FED?
Bitcoin and U.S. Bond Yield: A True Love Story (revised)When investors were fearful of the growing inflation they were looking for an asset to hedge against this madness. They used to buy gold back in the days, but recently they found Bitcoin. So now whenever investors lose confidence in the market they drop bonds driving the US10Y up and buy bitcoin instead.
Who is in charge?
Crypto-market is reacting to the global market and appears to be predicting the future of stock market by moving their funds in and out of the big crypto. Or is it the other way around?
There are two unique features in these charts:
1-These charts are out of sync and there is some degree of delay between them. It appears that Bitcoin is a few weeks ahead of the yields so perhaps investors move their money in and out of the bitcoin before biding on the bonds.
2-Both charts seem to be moving in a specific proportion. It looks like for every 3 points movement in Bitcoin, US10Y moves 1 point (See the blue arrows). When Bitcoin broke below its trendline and dropped nearly 33%, while when US10Y broke below its trendline it dropped around 11%.
Now what?
Considering the death cross on daily and the massive head and shoulder that are about to complete on the BTC chart, Bitcoin may not be done dropping:
So if it drops another 48%, US10Y should also drop but as much as 16%. Although, we are already anticipating a drop in the yield considering the CPI report released on June 10th:
What does it all mean?
1-Apes are going to have another run
2-The growth market should gain momentum
3-The speculative stocks should go up.
Please share your thoughts and theories in the comment section below.
Bitcoin and U.S. Bond Yield: A True Love Story When investors were fearful of the growing inflation they were looking for an asset to hedge against this madness. They used to buy gold back in the days, but recently they found Bitcoin, which has many advantages compared to metal. So as we know, whenever investors lose confidence in the market they drop bonds driving the US10Y up, but they seem to buy bitcoin instead.
It appears that investors are predicting the market by moving their funds in and out of the big crypto, which might explain the delay between these charts (white arrow). As you may notice, US10Y seems to be a few days behind BTC. Although, these charts are out of sync, they proportional. It looks like for every 3 points movement in Bitcoin, US10Y moves 1 point (See the blue arrows).
When Bitcoin broke below its trendline on May 11th it dropped nearly 33%, while US10Y broke below its trendline on June 8th and dropped around 11%, hence the delay and proportionality.
But considering the death cross and the massive head and shoulder that are about to complete on the BTC chart, Bitcoin may not be done dropping:
So if it drops another 48%, US10Y should also drop but as much as 16%. Although, we are already anticipating a drop in the yield considering the CPI report released on June 10th:
What does it all mean? It means:
Money tunnels out of Bitcoin into Bonds and vice versa
Yields react to the previous point.
Lower Yields should result in the following scenarios:
1-Apes are going to have another run
2-The growth market should gain momentum
3-The speculative stocks should go up.
Please share your thoughts and theories in the comment section below.