As the year draws to a close, it's an opportune time to evaluate the potential trajectory of the dollar going forward.
From a broader perspective, we anticipate a regime shift for the dollar in 2024, potentially marking significant turning points for the major dollar pairs. Notably, since the 1990s, each instance when real rates crossed the 1% threshold, the...
The attractiveness of Gold is tarnished
When cash instruments yield a positive rate of return
More and more people are getting on board of higher interest rates
(Dimon, Santelli)
But u can see the Gold price has been inversely correlating with the rate of return for decades.
It's bull run in the 2000's along with the commodity bull , coincided with real rates...
Split view showing the previous real rate of Bonds study along now with the actual Bond Yields. This is to gain insight into Demand dynamics for Bonds and what happens to yields when real yields are positive (expectation is that positive real yields will increase demand, reducing supply, and allowing Treasury to increase Bond prices and reduce yields.
A study showing the real rate of returns on the various US Treasuries. Calculated by subtracting the YoY Inflation Rate (released monthly) from the Yield of the Bond. Real Fed Rate also shown for reference. Above 0 makes Bonds and Savings more attractive, aka more Demand for them. Price may increase and yields decrease, encouraging selling. Below 0 provides...
US 10YR ‘real’ rates are essentially US 10yr Treasuries adjusted for 10yr inflation expectations – TradingView users can set this up using the equation: TVC:US10Y-FRED:T10YIE.
We can see this as the true cost of capital and in effect, the higher yields rise the more this supports the USD and negatively impacts US equity valuations. The rate of change (ROC) is...
Real rate is different from interest rate. Real rate is the difference between interest rate with the inflation. We have been running on negative real rate for a decade plus. This is an accommodative measure by the Fed to make sure the market is still running hot. S&P500 has been running well during this period of time where the interest rate is kept below the...
Real rates look like they are about to turn over.
This should mean that interest rates should drop faster than the inflation.
A good proxy for this is silver which looks like it is touching a support line and the 100 MMA.
hi there, dear fellow.
we've recently stumbled upon this chart, in the quest for a leading gauge for the dxy.
this chart depicts a paradox.
in white, US10Y-USIRYY; in orange, US10Y-US02Y.
if you remember our previous idea, namely on the DXY and the yield curve spread (US10Y-US02Y), we've pointed out back then that a steepening of the yield curve would be bearish...
There is a long running inverse relationship between gold and yields. As a non-interest bearing asset, gold becomes less attractive when yields, or real yields in-particular, go up.
Using the TIPS (Treasury Inflation-Protected Securities) and inverting the price (price and yields are inversely related), we get a proxy for real-yields. With this, we can look at...
During periods of deep negative real rates gold tends to do very well.
The 1970's was a decade which saw big moves in real rates due as the Fed trying to combat the high inflation.
The more volatile the moves are in real rates, and the deeper into negative territory real rates go, the better gold performs.
We may be entering a similar period where the Fed is...
Inflation expectations (T10YIE, red line) have been on the rise since Q1 2020. Nominal yields (US10Y, turquoise line) bottomed as gold (XAUUSD, yellow line) topped in Aug 2020 after the Fed marked the end of stimulus expansion, shifting speculation to timing the eventual tightening.
However, stocks (ESH2022, S&P 500 future, purple line) did not turn lower until...
The DXY has broken down from of a bearish ascending wedge. Looking to test the .618 Fib retracement level. If we break below this, the next support level at the .786 Fib level at about $81.5.
If this happens, Equities will likely remain in an uptrend, particularly commodities. Gold is normally in this category, but due to central bank manipulation I would say it...
Sold a bit more last night, should be settled at 1870, need income via dividend...wondering if I should have sold the whole lot (using a mutual fund so exits are a bit delayed). Should gold continue tanking from here...
Have 300 units left $10 entry, last exit was at 17.60 ish, want to hold the last 300 to see if gold can reclaim 2K and beyond, but my patience is...
As previously suggested, GLD touched 194 before correcting down to 178-181 gapfill, which has completed as of Aug 12th.
Now a bull flag has formed, 180 needs to hold for original bull thesis, with GP_C2 zone 179-180 being support. Bulls would want a decisive break out above the falling resistance as a confirmation for next attack towards 200. A couple of inside...
In this update I take a look at the yellow precious metal Gold. Both the technical and global macro picture are setting up for a perfect environment for gold to rally.
![USINTR: [STUDY] Bond Rates VS Real Rates](https://s3.tradingview.com/h/hQ58ZdY7_mid.png "[STUDY] Bond Rates VS Real Rates")
![USINTR: [STUDY] Real Rates of Bonds](https://s3.tradingview.com/y/YOFh2N1K_mid.png "[STUDY] Real Rates of Bonds")
