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US10Y

TLT +50% Every Time This Happens and It's Happening NowTLT/SPX Monthly RSI (8 Period Close) It makes sense to analyze the most common institutional portfolio allocation (Equities and Bonds) rather than Equities or Bonds separately. Most investors focus on Fed Funds, unemployment, the business cycle, rates, to analyze the bond market. But those metrics are poorly correlated to returns at best. When you focus on allocation, as in Bonds plus Equities, you start making some progress. That's exactly what this chart represents; where the money is going and when. Hint: it's going into Bonds. Soon. BBOT (Bonds Blast Off Time) is here
NASDAQ:TLTLong
by MarkLefevre
2
US 10Y TREASURY: retail sales eased the sentimentThe US Treasury market was under influence of the posted data for the Retail Sales in the US in September, as a potential add-on to the total inflation in the country. Released data were in line with the market consensus, as the indicator was higher by 0,4% in September, leading to yearly increase of 1,7%. Without other posted data which would add to the potential move of the inflation in the US, the 10Y US yields eased a bit, and tested the 4,0% level. Still, at Friday trading session, yields ended the week a bit higher, at the level of 4,075%. In the week ahead there are no macro data scheduled for a release, which could point to potential inflation movements, in which sense, it could be expected a relatively calmer week when US yields are in question. There is some probability that yields could test the 4,0% level for one more time, while odds are quite low for the move toward the upside.
TVC:US10Y
by XBTFX
Yield Curve Reinverts on Easing Rate Cut ExpectationsFed sets the rates. Rates guide treasury yields. Fed remains data dependent. Incoming data creates nuanced shifts in yield spreads. The September jobs report revealed 254,000 jobs added, significantly exceeding expectations of 147,000, with August figures also revised upward. This strong report, along with the JOLTS data from earlier in the week, indicates that the job market remains strong and not as weak as previously anticipated. Despite the strong jobs data, the yield curve has inverted once again. While Mint Finance has previously highlighted that recession risks can lead to the yield curve inverting, that is not the only reason. This time around, the inversion is being driven by delay in rate cut expectations. CME’s Yield Futures enables investors to deftly express their views on the path of rates ahead. JOB MARKET SHOWS MIXED SIGNS OF RECOVERY The latest JOLTS figures showed U.S. job openings rising from 7.711 million to 8.090 million in August, with the previous month's numbers revised up by 38,000. Although job openings remain near a two-year low, the increase is a positive sign. Rise in job openings was primarily due to increase in construction jobs (+138k), which are often seasonal, and government jobs (+103k). However, the overall report paints a mixed picture. Hiring fell by 99k from the previous month, and while total separations dropped by 317,000, the largest contributor was a 159,000 contraction in quits. With fewer hires and a large drop in quits, the data suggests the job market is not particularly strong, as workers hesitate to leave their current positions with fewer being hired into new roles. The Non-Farm Payrolls (NFP) showed 254,000 jobs added in September, with health care, social assistance, and leisure and hospitality sectors leading the gains. As a result of these additions, the unemployment rate eased to 4.1%. Hourly earnings grew by 4% YoY, with the previous month's figures revised upward to 3.9%. RATE CUT EXPECTATIONS TEMPER Further rate cuts are still expected, but the anticipated pace has slowed. Before the PCE inflation report on September 27, CME FedWatch indicated a cumulative 75 basis point reduction over the next two FOMC meetings in November and December. Source: CME FedWatch CME FedWatch tool also indicated a high probability of 100 basis-point cuts last month. However, after the encouraging PCE report, which showed inflation easing to 2.2%—its lowest level since 2021 and close to the Fed's target—the probability of a cumulative 50 basis-point cut has steadily risen. Following the jobs report last week, the probability of cumulative 50 basis-points cuts surged to 80%. The trend suggests that market participants are increasingly expecting a soft landing, with inflation easing and the job market remaining strong. A soft landing reduces the urgency for aggressive rate cuts, giving the Fed more flexibility to monitor the effects of previous rate hikes and lower rates more gradually. Source: CME FedWatch Crucially, Fed Chair Jerome Powell has suggested a similar outlook for rate trajectory. While speaking at the National Association for Business Economics, he suggested that if the economy continues on its current trajectory, he expects two more smaller rate cuts this year, or cumulative rate cuts of 50 basis points at the next two meetings. FOMC projections also signalled a similar rate outlook for 2024 as signalled by the dot plot below. Source: FOMC YIELD CURVE RE-INVERTS Bond yields have increased sharply to their highest level since August on tempered rate cut expectations. Crucially, the increase has been much sharper for the 2-year yields indicating near-term expectations of elevated rates for longer. The result has been a re-inversion in the yield spread with 2-year & 10-year treasury yields now on par. Notably, the yield futures spread has declined more sharply than the treasury yield spread. HYPOTHETICAL TRADE SETUP Recent economic data points to rising likelihood of a soft landing. Expectations of rapid rate cuts have tempered accordingly. While rates are expected to continue declining, the pace is expected to slow with a cumulative 50 basis points (“bps”) of further cuts in 2024 likely. As rates remain elevated for an extended period, the yield curve has begun to invert again. With current inflation easing, the inflation premium on long-term treasuries has diminished. FOMC projections suggest a gradual path toward rate normalization, suggesting a potential near-term yield curve inversion before it eventually normalizes. Investors can express views on this outlook through CME yield futures. Further, the yield futures spread is trading at a (~5bps) premium to the treasury yield spread, as the futures contracts approaches expiry on October 31, the futures spread will converge towards the treasury yield spread which further benefits the short position. CME Yield Futures are quoted directly in yield with a 1 basis point (“bp”) change representing USD 10 in one lot of Yield Future contract. This simplifies spread calculations with a 1 bp change in spread representing profit & loss of USD 10. The individual margin requirements for 2Y and 10Y Yield futures are USD 330 and USD 320, respectively. However, with CME’s 50% margin offset for the spread, the required margin drops to USD 325 as of October 8, making this trade even more compelling. A hypothetical trade setup comprising of long 2Y yield October futures and short 10Y yield October futures with reward to risk ratio of 1.5x is described below. Entry: 13.5 bps Target: -1.5 bps Stop Loss: 23.5 bps Profit at Target: USD 150 (15 bps x 10) Loss at Stop: USD 100 (10 bps x 10) Reward/Risk: 1.5x MARKET DATA CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme . DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
CBOT_MINI:10Y1!Short
by mintdotfinance
Very close to Yield Curve Inversion, AGAINAfter #InterestRates were cut people were expecting a furious wave of buying, this has not come into fruition. Recent events: 2Yr Yield rallied substantially. 10Yr #Yield bottomed when we called it, has not run as much as it's shorter term counterpart. We're close to inversion again! Colored areas = POTENTIAL Inverse Head & Shoulder = BOTTOM. Worth noting, TVC:TNX has a higher right shoulder. Further analysis: We are seeing a Negative Divergence on $DJI. Volume has been lessening as the days go by. TVC:RUT Small Caps are LOWER and trading in a tightening range.
TVC:US02Y
by ROYAL_OAK_INC
US 10Y TREASURY: surprised by jobs dataThe major macro news during the previous week were posted nonfarm and unemployment figures in the US for September. The nonfarm payrolls significantly beated market expectation, by reaching the figure of 254K, while unemployment rate dropped to the level of 4,1% from 4,2% during August. The markets are now convinced that the Fed will slow down rate cuts till the end of this year to 25 bps, considering the high resilience of the US economy. Previously, markets were pricing another 50bps cuts. The US yields adjusted accordingly to new expectations. The 10Y US benchmark was moving around 3,80 during the week, but Friday's jobs data pushed the yields to the higher grounds, ending the week at level of 3,96. Yields were testing the level of 4% previously. It could be expected that the markets will spend a week ahead by digesting the jobs data, in which sense, the 4,0% level could be tested during the week. At this moment, there is no indication that yields could move to the higher grounds. On the opposite side, there could be some relaxation, at least to the level of 3,9%.
TVC:US10Y
by XBTFX
US 10Y TREASURY: pricing the PCE easingThe inflation measured through the Personal Consumption Expenditure Index showed signs of further decrease in August. The Index was standing at the level of 2,2% on a yearly basis, which was a bit lower from market expectations. The US Treasury yields eased after the release of data, bringing the 10Y US benchmark to the level of 3,75% as of the end of the week. During the first half of the week, the 10Y yields were exploring higher grounds, reaching the highest weekly level at 3,82%. At the same time, released final GDP Growth data for Q2 showed no changes on a quarterly level of 3% growth, which pointed to investors that the US economy was growing in a moderate pace in the environment of high interest rates, and that further drop in interest rates will be supportive for the boost of the economy in the coming period. Current charts are pointing to a probability for further easing of the US yields in a week ahead. The non-farm payrolls are set for a release, which might bring back some modest volatility on the markets. Still, some significant moves in yields should not be expected. The levels around 3,7% might be tested in the week ahead.
TVC:US10Y
by XBTFX
U.S. Dollar Index is near to fall. Soon..The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against basket of other six major currencies, extends its losses for the 5th consecutive week in a row, hovering below 102 points during the U.S. regular hours on Monday, August 19. Over the past week, Gold spot (XAUUSD) has topped $2500 per ounce psychological high also, minting new all the history peak, while Forex Eur/Usd (EURUSD) pair just has flashed a positive 2024 YTD return, jumping above 1.10 psychological degree. The US Dollar continues to weaken following dovish comments from Federal Reserve (Fed) officials, which have increased a new portion of expectations for an interest rate cut by the central bank in September. Furthermore, last week’s US economic data revealed that both the Producer Price Index (PPI) and Consumer Price Index (CPI) suggest that inflation is easing. Federal Reserve Bank of San Francisco President Mary Daly stressed on Sunday that the US central bank should adopt a gradual approach to lowering borrowing costs, according to the Financial Times. Daly countered economists' concerns that the US economy is facing a sharp slowdown that would warrant rapid interest rate cuts. Additionally, Federal Reserve Bank of Chicago President Austan Goolsbee cautioned that central bank officials should be careful not to maintain a restrictive policy longer than necessary. Although it's uncertain whether the Fed will cut interest rates next month, failing to do so could negatively impact the labor market, according to CNBC. Additionally, the decline in the US yields contributes to downward pressure for the Greenback. 2-year and 10-year yields on US Treasury bonds stand at 4.05% and 3.85%, respectively, at the time of writing. This week, all eyes will be on Federal Reserve Chair Jerome Powell's upcoming speech. In a bottom line, the major technical graph for the US Dollar Index (DXY) indicates on possible huge decline for the next upcoming 12 to 18 months. The secondary RSI(14) graph indicates also, the bearish sentiment prevails.
TVC:DXY
by PandorraResearch
US10Y Look for a 1D MA50 rejection.A month ago (August 21, see chart below) we argued why the U.S. Government Bonds 10YR Yield (US10Y) would go lower with the Fed having no choice but the cut the Interest Rates: Well the Fed did it and cut the rates not just by -0.25% but -0.50%, initiating the new cut Cycle. Now let's look at the US10Y's price action on a smaller time-frame, namely the 1D. As you can see the pattern is a double Channel Down, with the price trading below the 1D MA50 (blue trend-line) since July 03 2024. That is the current Resistance and until it breaks (1D candle closing above it), we should be looking every time for a sell near it. Assuming the Bearish Legs of the diverging (dotted) Channel Down are symmetrical like those of May and June, our Target is 3.450%, representing a -10.50% decline (same as August's Bearish Leg). ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
TVC:US10YShort
by TradingShot
US 10Y TREASURY: surprising 50 bps cutAlthough markets were divided on whether the Fed will cut interest rates by 25 bps or 50 bps at their September meeting, still, the Fed brought some sort of surprise by cutting interest rates more aggressively, by 50 bps. Considering Fed's dual mandate, to keep inflation at targeted levels and a stable jobs market, the analysts are now noting that, with the latest rate cuts, the Fed switched attention to the US jobs market. The US yield reacted to the Fed's decision in a mixed manner. Still, the 10Y US yields turned to the upside, despite Fed Chair Powell's comment that more rate cuts are coming till the end of this year. The 10Y US yields reached the lowest weekly level at 3,6%, and soon reverted to the upside, ending the week at the level of 3,74%. While digesting Feds comments, the market is currently seeking an equilibrium level for the US yields. Based on current sentiment, there is some probability that yields might shortly revert back toward the level of 3,8%. However, on a longer time scale, the trend for 10Y US yields is on the downside.
TVC:US10Y
by XBTFX