Expecting a strong reversal on the 10yr yields. Good Luck.
CBOT:UD1! The UD1! is on up trend and explains where all the stock market money has gone the past week...lol. I think I understand yield curve, but missed this one. ; )
Entering into long position with Reward to Risk of 1.8 in US 30 years Treasury Bonds, fantastic high quality opportunity. I hope it will work out as expected!
I am entering a long position into long term US treasuries from a support line clearly visible on H4 and daily charts. Although the long term perspective for the price of bonds is negative due to expected rate hikes later this year and next year, on the shorter time scale (few weeks) the Treasuries seems under-priced after the strong decline last few weeks and...
The support zone at 152.05 is confirmed and well backed with strong buying activity. I am entering more aggressively at market with 1.40 Reward to Risk Ratio. If tomorrow US NFP data is negative it will additionally benefit this trade.
U.S. treasury bond yields are signalling deflation, whilst stock melt up indicating an inflationary economy. Does the bond market know something that stocks don't?
Friday's close below 2.3% would confirm a falling top pattern and open doors for sell-off to 2.0%... that is a 30 bps drop. The obvious casualty of a weak close would be the Dollar-Yen pair - it could revisit 110.00 levels.
Looks like the crowded bond short consensus/reflation trade is about to get smacked... Positions in stock and options between $TLH and $TLT. Extreme positioning usually does not end well for the herd. I wonder if people shorting when market rate for 10-Years was above 2.31% ever even knew that rates have been under pressure since peaking over 3 decades ago.......
Uptrend should resume after the 61.8% retracement and bullish divergence. Fundamentally a normal mean reversion of term premium is occurring. This should also support the USD in the medium-term and keep the uptrend intact for 2017. However the move may be choppy because of extreme long positioning.