US10Y 1-2-3 bearish reversal or 2B bearish reversal?US10Y 1-2-3 bearish reversal or 2B bearish reversal?
Short term broke red down trend line to head higher, but, eventually a later year bearish 1-2-3 reversal pattern or 2B reversal pattern?
Ustreasuries
Big Data and The Chart Patterns Suggest A Pump In Yields is NearI think we will see a pump in the Yields, the DXY, and a decline in Commodities. I posted the wrong ticker before but this is the correct one so if you entered the trade on TYD get out of it and enter TYO instead.
Big Data Coming Out Tomorrow I'm Calling For A Pump in YieldsGod luck with this potential bull flag trade i will be here in the premarket tomorrow morning to buy.
Bond yields keep fallingBonds all across the world, across all different spectrums (from gov bonds to junk bonds) have been rising (their yields falling). This is a signal that there are deflationary pressures and that people are searching for yield in an environment with few opportunities. There are other reasons too, but overall this isn't the best signal. Clearly big corporations and governments are benefiting from the situation, but this is also a fragile situation. Although the current conditions benefit some stocks and risk assets due to the highly negative real rates, this doesn't mean that everything is perfect. Personally I believe equities haven't topped and they have much more room to grow from here, but I also think a big correction isn't far away (10-20%).
In my opinion bond bulls are in control (bearish on yield) and yields could fall even lower.
Natural Gas Breakout is Imminent Natural Gas has already been bullish over a trend duration (3 months or more) as it recovered from the Covid Global Deflation. Now Natural Gas is quietly setting up for a bullish TAIL Breakout, i.e. the start of the next bull market in energy and commodities.
To call the next commodity supercycle is a little early but we can see several factors hinting at that over the coming 1-3 years. Regardless, we need to trade the market in front of us, and as such we only really care about the next 3 months when it comes to near-term risk management.
Over the next 2-3 months I would not be surprised to see Natural Gas hit a multi-year high between $4 and $6. Given that inflation is non-linear and is really accelerating, its conceivable it could go to $10 in a major commodity reflation move.
Our Macro Nowcasting Machines with a 60-90% success rate in predicting growth and inflation 3-5 months out (the forecast gets more accurate the closer we get) says that Quad 2 growth and inflation accelerating will peak just before the summer. April-May time period. Following that will be a decelerating of growth and inflation, so we will have to risk manage that drawdown proactively. But we are not there yet so we must focus on Natural Gas's upside in the immediate term. The same holds true for commodities broadly, including uranium, fertilizer, agriculture, crude, and copper/industrial metals.
Looking at the 1H timeframe we can see a healthy consolidation of higher lows and volume/momentum indicators that are not near being overbought. The volatility signal shows volatility can go much lower which is a good thing for price. Breakout is imminent.
Looking at Natty through the lense of market positioning, the net long position in natty more than doubled the week before last (last week's data comes out tomorrow, will provide an update) which is a huge move. The 3month average net long was added in a single week. But the max net long position over 3Y lookback is 2.5x the current net long. In summary, Natty is not crowded, it is not a consensus position, and has significant upside.
If you haven't been hedging for inflation that last 5-10 months where have you been?
Are the bond bulls in control or is it time for a break?Bonds have reached a very important level. For now this seems like a *logical* place for the *anti-reflation* / deflation trade to end, and for the risk on trade to be back. I am more on the disinflationary (very low inflation) camp, however bonds have risen substantially and it might be time to take some profits before the resume lower. I don't think we will have extremely high inflation yet and I don't think we will have the good type of inflation because things are going well. I do expect Oil to go higher and that to cause all sorts of issues and higher prices, but other than that I don't think bonds will get crushed. At least no yet.
The key question for the whole reflation trade is... WIll bonds and USD keep going higher, with only US behemoths rallying or and the rest bleeding or struggling, or could we get a larger shock? Because to me if the USD really breaks out and heads for 96 on the DXY, while bonds also rally... we will eventually see something break. I think we'll soon have a better idea of where things could be heading next so it is better to be patient and take a few select trades that go well with this environment and look technically sound.
Full Faith & Credit. & Popcorn10y UST yields are collapsing. Why. According to financial media - nothing. "Things look gloomy." "Upside on economic rebound priced in." "Supply/demand for USTs" (that last one is technically correct, but is so incredibly basic/generic that it can be categorized under the same → you people have no idea why, and you're just talking for the sake of talking.)
So here is a stupid explanation. Or maybe not so stupid. Maybe pure coincidence. Maybe not. Maybe grey areas. Who knows, I certainly don't. But you will never see anyone in financial media a) ever connect these dots, or b) ever dare put such a thought out there.
I'm doing just that - putting something I'm observing out there. Could be nothing, could be everything. At least its SOMEthing concrete to answer: WHY are USTs bid, and WHY NOW. And no, people didn't just suddenly flood into USTs on something generic like COVID resurgence or something economic - why did they crush yields to sub 1.3% today in such a rush. Did the delta variant show up at US cash open for the first time??
In Jan, institutions (hedge funds especially) were completely caught off guard on the meme rally - and they were scared. The final week of Jan '21, GME shares and the VIX moved in tandem (chart it out), and there was also demand for the safety of USTs.
Since then, HFs have now gotten involved in trying to trade meme stocks. This time last month, AMC options traded over a trillion dollars notional value in a week. Retail might have firepower, but a trillion in turnover in a week on AMC vol? Yeah, there are hedge funds in there too.
Now we're seeing AMC collapse - and collapsing right in line with USTs getting bid. Risk → safety.
Stupid observation? Sure, can criticize away. At least its something concrete to put out there.
-Weston
US GOV BONDS 10 YR YIELD - MULTI TIME FRAMES - ONGOING DOWNTRENDM1 : Levels to watch :
Upside : 1.80
Downside : 1.4880
W1: Last week closing below Tenkan-Sen
D1 : In an ongoing downtrend channel, currently below TS and MBB;
currently traded around the top clouds support zone and still above
the middle level of this downtrend channel.
H4 : Last recovery attempt towards 1.69, failed !Below KS, MBB and TS. Bottom of the clouds
support has been tested !
H1 : The low reached @ 1.5940 triggered some corrective recovery, but still below the clouds
M30 : Recovery attempt in progress towards the clouds resistance area.
M15: Clouds, for the time being, rejected the breakout attempt.
M5 : In the clouds, looking where to go...
CONCLUSION :
THE TREND IS YOUR FRIEND AND ONLY A SUSTAINABLE MOVE ABOVE 1.8000 WOULD FORCE A VIEW REASSESSMENT
OF THE EXPECTED (YIELD) BEARISH SCENARIO.
Ironman8848
US GOV BONDS 10 YR YIELD - MULTI TIME FRAMES M1 : 50 % Fib Ret @ 1.8060 % nearly reached,
high seen so far being 1.7740 % in March.
W1 : Sideways 1.4840 % -1.7740 % trading range
Currently traded below Tenkan-Sen (conversion line)
D1 : Still under the influence of a former double top
formation and failure to hold above the clouds is likely
to trigger further downside in the coming session (s)
Interesting to note that the low seen a couple days ago
@ 1.4840 is roughly in the middle of the clouds support
zone.
H4 : Minor double top triggered at the top of 1.7050, target
easily filled. More important, below TS and MBB and currently
attempting to breakout the ongoing uptrend support line.
H1 : Below the clouds and below the cluster of KS, MBB and TS
M30 : Same than H1
M15 : Attempted twice to upside clouds breakout, without success !!
M5 : Below the clouds, showing some short term recovery attempt
CONCLUSION :
THE 10 YEARS US IS SHOWING AN ONGOING (YIELD) DOWNTREND PRICE ACTION.
ONLY A SUSTAINABLE RECOVERY ABOVE THE 1.80 % WOULD FORCE TO A VIEW REASSESEMENT
OF THE EXPECTED BEARISH YIELD SCENARIO CALLING FOR LOWER LEVEL TOWARDS THE 1.40 % AREA,
BEING THE DOUBLE TOP TARGET, THE BOTTOM OF THE DAILY CLOUDS AND LAST BUT NOT LEAST THE
LEVEL OF THE MID BOLLINGER BAND (MBB) ON W1, WHICH SHOULD BE SEEN AS THE LEADING INDICATOR ON
THIS W1 TIME FRAME. A FAILURE TO HOLD ABOVE 1.40% WOULD DIRECTLY PUT THE FOCUS ON 1.29% AHEAD OF 1.14%
WEEKLY CLOUDS SUPPORT !
A SUSTAINABLE RECOVERY ABOVE 1.80% (UNEXPECTED) WOULD OPEN THE DOOR FOR THE PSYCHOLOGICAL LEVEL OF 2 % AHEAD
OF 2.15% BEING THE 61.8% FIB RET AND ALSO THE MONTHLY CLOUDS RESISTANCE AREA.
Ironman8848
US GOV 10 Y - INTRADAY - TRADING IN THE ZONE !H4 : Triangle target filled @ 1.6860 %.
Ongoing reversal in progress
Watch, on H4 closing basis, Mid Bollinger Band (@ 1.6280) as first support indicator
H1: After having briefly broken the uptrend channel (wrong breakout, doji top followed
by a long black candle ! the 10 Y is still in this ongoing uptrend channel with a first attempt
to downside breakout, which failed.
Below the support line of this channel there is a more important support zone to look at, which is
the clouds area with its bottom level, which coincides with the 38.2% Fib ret @ 1.6270
A failure to hold above that level would put the focus to lower level, 1.56 % being the level
of the triangle prolongation on H4 . If seen pullback would be achieved
M15 : A Head and Shoulder formation is in progress with its neckline broken.
Technical target is @ 1.56 % too
CONCLUSION :
Expected trading range 1.70-1.55 % on short term
US GOV BONDS 10 YR YIELD - M1/W1/D1 - POINTING TO THE SOUTHM1 : After having nearly reached the 50% Fibonacci retracement of the 3.25% to 0.3620 %
move, high being 1.7740 % !, the ongoing current monthly price action is showing a potential
trend reversal in progress, which could trigger, tomorrow, on a monthly closing level, a "DARK CLOUD
COVER" (Wait for confirmation)
W1 : Double top price action in progress with its trigger level @ 1.5890 which has already be broken
several times so far but not confirmed yet !
A breakout confirmation of that level (1.5890 %), on a weekly closing level, would give a technical target of 1.4040 %.
Important to note that the level of D1 Mid Bollinger Band i@ 1.3490 % and a move below that level
would be the second validation signal of this double top formation.
VERY STRONG SUPPORT ZONE BELOW BEING THE CLOUDS AREA !!!
D1 : Despite the yesterday's breakout attempt, the ongoing downtrend (in yield) price action is still, for the time being, intact, calling
if 1.5890 is broken,for the target above mentioned of 1.4040 %.
ALSO VERY IMPORTANT TO NOTE THAT THE LEVEL OF THE DOUBLE TOP TARGET AT 1.4040 % COINCIDES WITH THE D1 BOTTOM CLOUDS SUPPORT
LEVEL !!!
On the upside, the ongoing downtrend resistance line should be seen as the first important level to break and this on a D1 closing basis !
In case of a confirmation of this breakout, we may see a retest of former high 1.70-1.77 which should, if seen provide, again, good selling (yield) opportunities.
Watch intraday shorter time frames, (H4,H1 and M15) to get intermediate signal (s), such as divergence (s) which would allow you to adapt your trading plan
in acting accordingly.
Have a nice trading day.
All the best, take care.
And last but not least, if you find my technical analysis valuable for your trading, please do not forget to like it and if not done yet add me on your following list.
Ironman8848 :-)
US GOV BONDS 10 YR YIELD - EN ROUTE FOR 1.4040D1 : Ongoing bearish (yield) price action calling for the double top target @ 1.4040 % which coincides
with the Ichimoku clouds support area.
W1 : Successive black candles; Tenkan-Sen under attack ! Looks like a mirror effect...
M1 : Long term trend reversal in progress (should be confirmed on a monthly closing basis !)
ECB meeting in spotlightEUR/USD is having a rare day in negative territory. Currently, the pair is trading at 1.2006, down 0.24% on the day.
The euro has been in fine form in April, racking up gains of 2.3%. The currency has made up most of the ground lost in March when EUR/USD fell by 2.8%. The direction of the US dollar has, to a large degree, been dependent on 10-year US Treasury yields. In March, yields moved higher and provided the dollar with a lift. Conversely, with yields retreating in April, the dollar has suffered broad losses.
The ECB holds its policy meeting on Thursday (11:45 GMT), and the central bank is widely expected to hold the course on monetary policy and leave the main financing rate at 0.00%.
With the developed economies expected to show significant recovery in 2021, there have been rising concerns about taper tantrums, once central banks change their ultra-accommodative stance, which has been put in place in order to deal with the severe economic downturn caused by the Covid-19 pandemic.
This is unlikely to be an issue with the ECB, which appears determined to continue fiscal and monetary support for the eurozone until the recovery is well underway. Once that occurs, the ECB can be expected to reduce purchases under its emergency pandemic programme (PSPP), while continuing its traditional QE programme, under which the ECB has been purchasing bonds in the amount of EUR 20 billion/month throughout the Covid pandemic.
With the upcoming ECB meeting expected to be a"snoozer", the meeting could well be a non-event for the euro. It has been a good week for the euro, which punched past the symbolic 1.20 level this week for the first time since March 4th. The currency could get a bit of a boost if ECB President Christine Lagarde's comments after the meeting are more optimistic than expected.
EUR/USD is testing resistance at 1.2027. Above, there is resistance at 1.2073. On the downside, there is support at 1.1903 and 1.1825
The Big Hedging is Coming; Bonds and VIX looking BullishThe market lately has been very unstable to say the least and has been willing to jump onto any boat it can in order to avoid inflation, However the price action we are seeing on the 30 YR seems to indicate that Inflation fears are overblown and that the Value if the Dollar index will likely remain stable.
While looking through the charts i noticed that there was an unusually high correlation between the 30YR Bonds and the VIX: Starting March 3rd 2014 as marked by the green vertical line on both charts. You can see that most Green Months in the 30 YR results in a Green Month in The VIX. I assume this is because many investors buy bonds in times of market uncertainty as a hedge against potential downturns in the value of equities and securities.
Todays Surge in Treasury Bonds could signal: A rise in Volatility to come, A downturn in the Stock market, and a Rise in both the Value and Confidence in the US Dollar.
... and as this bubble bursts; When and just how bad? ... (II.)... Feel free to come up with your own preferred narrative.
Here is the the Original Post;
This current post;
is generally just a cleaned up version of the original.
US10Y - Trying to reach 2.80% by SeptemberUS10Y - Trying to reach 2.80% by September 2021.
Goodbye Mr Stock market.
US10Y - On track to meet Yellow line by November '21.US10Y yield. On track within rising wedge to meet yellow trendline.
If it breaks yellow line, it's 'Goodbye Mr Stock market'.
US10Y- About to explode upwards with a Democratic clean sweep.US10Y- About to explode upwards with a Democratic clean sweep.
Brace yourselves. Once, the U10Y climbs beyond a point within the next 3-6 months, expecting the financial markets to crash.
