Fixed Income, USD Approaching Critical Support Levels

Fixed Income, USD Approaching Critical Support Levels

Below I plot the price of the US long bond. The YTD sell-off in 2018 has taken us down to a critical, nearly 40-yr support level.  It is this very support that has defined the secular bull market in fixed…...

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Yield Curve: Implications as we Approach 40-Year Support

Yield Curve: Implications as we Approach 40-Year Support

Something on the macro front that’s beginning to get some attention is the US yield curve (2s10s), but I think it’s being discussed and analyzed absent proper context. What’s being emphasized is its collapse over the past year.  This is true…...

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Chart Dump

Chart Dump

Let’s start with a top-down view by looking at the R2K. Yesterday’s tax plan-fueled rally in the major indices helped launch it significantly higher.  In the process, the index managed to smash through multiple years of upside resistance.  This resistance…...

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Heading into BREXIT 2.0, Is US Long Bond Analogous to GBP in 3Q92?

Heading into BREXIT 2.0, Is US Long Bond Analogous to GBP in 3Q92?

In a few recent posts I’ve highlighted that the discussions around BREXIT 2.0/ERM2 are occurring as the ratio of the Stoxx600 vs. SPX hits channel support for only the second time in history (on a monthly basis vs. three times on a daily)…....

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All the Macro that's Fit to Print

All the Macro that’s Fit to Print

Every corner rounded seems to be producing a different chimera to be contended with at the moment. BREXIT, growing portions of sovereign debt lurching into negative-yield territory, NIRP chaos and its impact on Euro banks, China deval/credit collapse, Islamo-fascism, Fed tightening and…...

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U.S. Long Bond Yields Threatening Imminent Break of 8-Yr Support, GFC Lows

U.S. Long Bond Yields Threatening Imminent Break of 8-Yr Support, GFC Lows

In the chart below I plot 30-yr U.S. long bond yields over time. A couple things: Yields have traded in a well-defined downward-sloping channel over time Major geo-political/monetary events have occurred when (or as) yields have broken below the green,…...

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TIP Break-Out Confirms Reflation Thematic, Augers for More Equity, PM Upside

TIP Break-Out Confirms Reflation Thematic, Augers for More Equity, PM Upside

As intimated as an increasingly likely outcome in this post on 3/2/16, treasury inflation-protected securities, via the TIP ETF, are breaking out of a consolidation/flag pattern put in place b/t lines (1) and (2) over the past five years. This…...

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Inflation Set to Expand?

Inflation Set to Expand?

The chart below shows TIP, or a vehicle that tracks inflation-protected treasury security prices, with a gold overlay. When TIP is rising in value inflation-protected securities are being bid up in anticipation of inflation rising; when TIP is declining it…...

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30s10s Curve Steepener a Prelude to Higher Gold Prices

30s10s Curve Steepener a Prelude to Higher Gold Prices

In the chart below I’ve plotted the ratio b/t the yield on 30 (TYX) and 10 (TNX) year treasuries over time.  The ratio is simply another way to look at the bps spread diff b/t the two. Note that at each…...

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After Brief Respite, Rates Set to Rise Again

After Brief Respite, Rates Set to Rise Again

After a brief respite, I believe rates are set to rise again, especially on the long bond. This was a thesis we originally laid out here on 6/15/15.  That day rates on the 30 yr closed at 3.09% vs. the…...

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