Following the FOMC minutes on Wednesday, gold has seen a massive two day move that brought the precious metal to five-week highs. Worries mount as market participants are beginning to realize that the Federal Reserve is stuck within a liquidity trap. The minutes statement indicated that the Fed saw risks to near-term inflation (as the five-year breakeven rate hit...
The dollar-yen has been rather range bound, floating between 123 and 125. The U.S. dollar is likely to remain firm heading into September, as many market participants believe the Federal Reserve will finally raise the Fed funds rate for the first time since 2006. Many traders are looking at the fact that funds rate future traders are pricing in a 54 percent...
The rally in long dated US treasuries over the past 35 years could easily be called the greatest bull market we've seen in modern times. 10 yr rates have been trending down in a near perfect channel for almost 30 years. Calling for the end of this rally has become a popular pastime. Due to the nature being zero bound on rates, the upper trend line will with...
Above is a look at the 10 yr Bond prices relative to S&P 500. The purpose isn't to look for an exact top where prices or the ratio trend may reverse but instead to see where we've been in the past and where we are at currently. Breaks in the long term down trend of this ratio have lead to large moves in the SPY, however, determining those breaks in the trend are...
No entry for now. Bonds gapped down and didn't even get close to our entry area. We will watch for a bounce...below the zone we will continue to look short.