Bearish Divergence on the US10 Year YieldIf we can see tthis begin to come down from here we will see stock continue up and the dollar return down.
Bonds
US Treasure Bonds Yields - Long TermAlright so I've come up with a formula between different US Bond Yields resulting in an oscillator indicator - which successfully signals tops on the stock markets and the bear market after.
Based on the area where that oscillator crosses the 0 value (down), we start topping until it comes back up. This period last in average around 1 year and is aligningt +/- with the actual top of SPX.
This is a period in which stocks may consolidate or still go up - overall an area of indecission, ending bullish power etc.
The actual drop always comes after that period and last up to 800 days- depending on the strength of the previous bull trend - The longer and stronger, the bigger the fall.
All such corrections were hitting lower than 0.618 fib level - meaning we will hit 2200 or even 1600 (SPX).
Key takeaways:
- We're not in an actual Bear Market yet.
- We are in consolidation meaning a pump for ath retests is possible until March 2023 +/-
- After March 2023 we should start real falls until around March 2025
- SPX Bear Market Target 1600-2200
Sorry and you're welcome!
BTCUSD vs US01YUS10Y has been crazy lately. It has broken an all time down-trend channel and was moving just like we would like BTC to move. But anyways... Why does this affect the market ?
When confidence is high, 10-year bond prices fall and yields climb. This is because investors believe they can find higher-yielding investments elsewhere and do not believe they need to be conservative.
In other terms - if risk assets bad, us10y good and vice-versa. As we can tell by the chart - investors have been running away to US Government backed Treasury bond to save themselves from the drops. But what now, when we're reaching high levels?
At first US10Y was driving up together with the rest of the markets - since covid's '20 crash we experienced a massive bounce (or pump) on all assets. This positive correlation has lasted until breaking the descending resistance on US10Y - since then the correlation was only negative for crypto and it is there, where risk-assets investors started saving their funds into bonds.
Right now US10Y is approaching a really big confluence of resistance: ascending triangle target, long time resistance level and top of curvy channel. Crossing this is almost impossible, specially if last weeks were growing evenly week by week creating a stair-like growth . And those like to drop heavily afterwards... + we're at resistance (reminder).
If US10Y bounces down now, it would mean BTC $17k was a local bottom (not long term, just for now!) and could make up all the fall it had until now as investors would re-enter risk-on assets
Where would BTC bounce to ? $38k-$40k if euphoria doesn't drive it further. It was since then when BTC started falling down without retesting broken levels.
Hope this helped you understand markets a little bit more today. If there's nothing new to you here - you are an MVP.
Cheers!
PS: Too early to judge, but if the price bounces to those levels - it would create a cup/handle pattern.
All is in FED's hands now.
US Bond yields rising as the market slows downEUR/USD ▶️
GBP/USD 🔼
AUD/USD ▶️
USD/CAD 🔽
XAU ▶️
WTI ▶️
As the US bond yield curve remains inverted, bond yields are fueled by the imminent interest rate decision from the Federal Reserve, the 10-year Treasury yield reached 3.514%, and the 2-year bond yield went higher to 3.934%. Although the stock market did slightly recover from yesterday’s losses, the forex and commodities markets looked quiet otherwise.
Major currencies recorded minor gains against the greenback, EUR/USD closed at 1.0022, GBP/USD added 17 pips to 1.1429, and USD/CAD decreased to 1.3248. The latest meeting minutes from the Reserve Bank of Australia maintained their monetary tightening policy to control inflation, and expect further rate hikes ahead, the Aussie / Dollar pair mostly traded flat, with a closing price of 0.6727.
For now, recession fears have canceled out positive signals in the market. Gold futures were little changed at $1,678.2 an ounce, WTI oil futures briefly dipped to $82.15 per barrel before returning to $85.36.
More information on Mitrade website
The Monday Overview - DXY Gold SIlver Wheat Bonds BTC DAXAn overview of the markets I often cover. Dollar should pull back lifting just about everything, Wheat may have to retest 800, Bonds ABC continues to 120's, Dax (germany index) looks interesting at support and may be hinting at a larger bounce in world markets. Good luck!
Why Bonds Might Be Nearing LowsBonds have continued their decline as the markets price in a potentially historic FOMC rate hike this week. Inflation data suggests that the Fed's rate hike trajectory is not really working and inflation is still soaring. On the other hand, multiple indicators suggest that we are in a recession, and the Fed will have to pivot their hawkish stance after this last rate hike. If that is the case, then we expect the bond market to be nearing lows. We have one more technical level before we will have to start using inverse Fibonacci extension levels to predict lows in bonds again, as 113'12 is our last technical level. The Kovach OBV also appears to be leveling off. The next targets from above are 115'03 and 115'29.
Huge Recession WarningWith the 2022 recession ever coming closer, more hints that it’s nearing appear. One of those hints include this graph, which shows the 1 year bond surpassing the 4% mark, and it’s more than any other bond. For the first time in more than 15 years, the 1 year bond surpasses 4%. The yield curve has been inverted for more than 1 month, and it’s still inverted. At any point Black Monday can happen and crash the market. I believe the recession that is about to happen will be worse than even the 2008 recession. It’s more of a depression, not a recession. The 1 year bond didn’t reach as high back then before the recession.
TVC:US01Y
SP:SPX
Capitulation IndicatorThe 30:10 Treasury Bond Yield Spread is a simple Ratio difference between the 30-Year Treasury Bond Rate
and the 10-YearTreasury Bond Rate.
A Large exodus from high Beta/Rho correlated Assets to perceived Safe Havens.
Presently the best-performing and most stable Asset of 2022 has been Cash - The US Dollar Index was 94.63
in mid-January to a high of 110.78 - a return of 17.066%.
Both the 30:10 Ratio and DXY performance are indicating an extreme lack of confidence in the strength of
the Economy.
Quite recently Cross Flows among Capital Stocks - largest Inflows this week are 2-year Treasury Bills @ 288%.
The flow was Net Cash to the Curve by Institutional Investors.
Concerns are rising with respect to both the return of Capital as well as the return on Captial.
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$3.196 Trillion across - Stock Index Futures, Stock Index Options, Stock Options, & Single Stock Futures.
P/C remains elevated @ .72 with .76 being the Pivot.
The LIS for 4X Expiry is SPX 3900, we will need to see Open Interest activity as the Day progresses.
It will either be supported for the Close or it will not as the next support is the Lows in June.
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It is important to observe the steep decline in Open Interest.
The largest SPY Roll was into the OCT Expiry @ 372 Puts.
SPX shows a parallel Roll.
Please watch the Globex Lows - the NQ and ES can trade lower, it will be important for the NYSE Open.
I focused initially on CASH for TECH - QQQ's 285 had the largest Roll period. In addition, all Strikes with a few
exceptions up to 310 had retail rolling from 287.
At the moment the O/I is churned for tomorrow, with both ROLL and SWAP to Retail, BUT Retail was a net
BUYER of Calls.
383 is the Primary Support now that we crushed the trend lines, the Fibs line up there for the SPY.
The ONLY issue I see is the Algos took the ES Futures up and over its Pivot trendline at the Close by a
very small amount.
Whether or not we open Up and then backtest or fall away will depend on several indications from the
VIX VVIX $ 2YY... Volumes will be enormous.
I'm looking over correlations and ratios and then swinging back around to Futures Options.
This is what sticks out at present, the concern, of course, is Retail Longs who thought yesterday was a
great day to enter Calls.
What stands out is the size of Roll skipping the weekly expirations for both the SPY, SPX & QQQs.
Intra-Week Roll is almost non-existent.
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**** This week matches a record from 1930 -the lowest raw number of Stocks Up as a percentage.
I warned of the 4X Expiry being a large Risk, for revview -
$TNX showing strength but it's being fought$TNX is NOT backing down, so far
Doesn't make sense for it to stay where it was
3.46 is way low for 75bps, UNLESS...
The monthly is worrisome
Granted we have couple weeks left but chances of it selling off are minimal
We're looking @ a trend break
Let's c what #FEDs do
US 02 Year Bond Yield Blasts higher on 100bp hike talkUS02Y Well now. Just when you thought the 2 year was overcooked and looking for a retracement.....
SPY/SPX - $8 Billion Press to Downside Protection - 4X Expiry
Institutional Protection (Hedging) reached an All-Time High on the September 16th
Quad Witch Expiration.
This position dwarfs prior hedging Highs by 103% and is rising by an additional $8 Billion
added to the hoard of Puts Friday.
Not only are the positions outsized - it was 308% of 2008's Hedging.
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Intense Volatility will return in September.
Of Note, with the declining Volatility Complex, VX Hedging has not dropped within a
concurrent Cost Correlation.
Options Writers are set for 3.19% IV for September... which may portend significantly Higher VX
on any significant change in arrangements.
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On to the SPX/SPY and what is ahead. Of Note, I am Using the SPX as Large traders and
Institutions are most heavily positioned here. Levels for the SPY are contained below.
Trader Sentiment began the Week at 18.1% Bullish & 53.3% Bearish for the next 180 Days.
ISM Price Paid Component declined 34.6% on the latest print as Commodity Intermediate
Inputs have declined significantly.
Interest Rate Forwards are indicating the FOMC will be @ 4% by January. The short end of
the Curve continues to confirm the Fed Fund Futures. The DX took a breather on the Effective
Rate Tussle between the EU and US.
Powell will not do anything less than 75Bps and should the CPI be above 8.1 - 8.2, odds favor
Powell stepping up the odds of 100 BPS, anything below 8 and 75Bps will be the LIS. The
Fed is "data dependent" - ie. they bought themselves time and have already indicated it
will be, at minimum, several months of observing the Data and not one nor two.
Market Internals were solid with 90% Up, 10 :1 Advance peaking at 17 : 1 Intraday. Breadth
improved as well, not significantly, but an improvement pushing the Closing Basis above the
10-Week Moving Average. Friday's rally was broad as was Wednesday's.
NQ's Up/Down was higher as well, with a slight broadening after coming very close to putting
in a lower low.
The Put/Call ratio fell from 1.01 on Tuesday to .80 on close Friday - a 3-day decline.
The ViX has 19.46 wide open again as we move into Roll through Settle, expect a surprise
soon. It is ahead. The VVIX came up to its Pivot and failed badly.
Extreme awareness of the UST Curve and Futures is vital to success as we are seeing 4%
come into our view. DX, same considerations, the Ball is in Powell's court now that LeGarde
has made her tit for tat. FX Disruptions were not considered not all that long ago. I pointed
out they would be arriving shortly back in August of 2021. Very large disruptions were
promised and delivered. 100% Ditto Bonds and their impending implosions.
Dung was Flung then, not so much now and it is quite far from over for Bonds.
As for the Levels in Trade this week, they can be observed on the Weekly Chart in a larger
context.
For Sunday Globex / Monday, here are the levels:
NQ - Range Expands from 12,438 to 12,866 with 12508 as the Pivot.
SPY - Range Expands from 405.44 to 415.22 with 406.17 as the Pivot. The 407.37 Gap is filled.
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*Options have continued to play an important role in Price over the past decade. Presently,
they drive prices significantly.
I will produce a thorough explanation, in detail, in the next few days. It will include:
1. The 5 Greeks and how they function - Delta, Gamma, Theta, Vega & Rho.
2. Alpha and Beta relations from the Underlying to the Derivative.
3. The Yield Correlations.
Have a great weekend, Good Luck on the Open - Trade Safe.
Bond Market Continues to Price In Hawkish FedBonds have picked up slightly edging above 115'29. ZN had teetered about this level, breaking below it yesterday, but finding support. We did make a run for the next level at 116'20, but rejected this level, and found support again at 115'20. There is a stronger chance of a 75bps rate hike, which is pushing up yields. If we fall further, then 115'03 is the next target.
DE10HELLO GUYS THIS MY IDEA 💡ABOUT DE10 is nice to see strong volume area....
Where is lot of contract accumulated..
I thing that the Seller from this area will be defend this SHORT position..
and when the price come back to this area, strong SELLER will be push down the market again..
DOWNTREND + Support from the past + Strong volume area is my mainly reason for this short trade..
IF you like my work please like share and follow thanks
TURTLE TRADER 🐢
10Y Bonds overbought10Y Bonds are overbought kissing 200 MA
RSI OB
MACD OB
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This is a sign the ASX could bounce as 10 years pull-back from overbought and 200 MA being resistance.
If bonds reak above 200 MA it signals a continuance in market fear and scepticism.
US10Y Already found broke above 200 MA and it is now a supporting moving average, bad sign ASX could follow.
Fall trading has begun - SPX 500 USOIL BONDS WHEAT BTC DXY GOLDALl in the video, still bullish on the stock market, but a small sell off first would be appropriate to trap shorts. OIl looks like 92 target should come sooner rather than later. Bonds still under the channel. Wheat still looks great. Gold looks promising and the US dollar likely pulls back to help it. BTC hard to tell but I would think higher after a small sell off.
DXY: Channel DXY: Channel identified using positive correlation as a means of confirmation. Rate changes, bond yields, and introduction of global policies on watch for price delta sensitivities. Continued regression to the mean and oscillation towards upside is current sentiment// DXY Price at time of published data: 110.249 // Bias: Neutral to Bullish
30Yr Bonds Long & Short Plays In the ChannelIn this update we review the recent price action in the US30Yr Bond futures and identify the next high probability trading opportunities and price objectives to target
Bond Market Reacts to Nonfarm and FedBonds fell again, hitting our next target at 115'29. Yields are creeping up as the markets are pricing in the next rate hike, expected to be 50-75 bps . Nonfarm payrolls gave us some insight into economic conditions: unemployment rose to 3.7%, with a headline miss and downward revision. This suggests that the economy is weakening further, and we are in a period of stagflation. Yields subsequently weakened and we are seeing a slight pivot off 1529. If we rally, we could hit 116'20 or even 117'08. If the figures are hotter than expected it should bolster the Fed's hawkish rhetoric and we could break through 115'29, to 115'03.
2 Yr Yield Screams HigherUS02Y short term bond yield has screamed higher since Powell's comments at Jackson Hole. This is bearish for stocks.
Entering the ER months - SPY USOIL WEAT BONDS GOLD DXY BTCSeptember 1 and that fall reversal may be in the air.
Looking for a reversal from the falling wedge, but believe me it could easily end up as a false breakout. I'm sure many eyes are on it at this point. If we do rally from here, is it a minor rally? If so, we may set up another, larger, head and shoulders pattern. OIL is at support, Bonds are sucking and probably go into the 120's even if they bounce. Wheat futures / ETF at support as well. Gold needs to hold 1675 level but the Dollar is very strong long term. The USD may pull back here though. BTC is holding up well.
Tomorrow at 8:30 is Jobless claims and then ism at 10am, you can watch for economic news on this nice economic calendar
us.econoday.com
The Monday Sample Pack - SPX500 USOIL BONDS WEAT GOLD BTCA Monday update with all the usual suspects. Liking SP500 for a large bounce, Weat is tasty, OIL to 104 looks good, BONDS sucking wind, GOLD, nice reversal, BTC expecting upside but maybe one more down (along with markets). In general I expect the week to be positive.
Also, GEO is taking off. Good luck!
$US10Y 10 Year Bonds Key Levels, Analysis and Targets $US10Y Key Levels, Analysis and Targets
Oh my goodness… 10 year bonds are breaking out on the monthly for the first time in 30 years… This is epic…. Equities are so screwed… I never thought that I would be saying that the bond market looks interesting... LOL... 🤷🏻♀️
TLT previous support level reachedWith hidden daily bullish divergence at this support level we SHOULD see some buying start to happen. If not, the channel will break and it will look like they want to test the lows. This week's closing candle is very important. Under 111 will look ugly on a daily close, under 110 even worse.
