Decision point

As long-term yields decline…

We have a headline this morning that is so in accordance with the times. Where just a few months ago the hysteria was toward inflation and runaway bond yields (ha ha ha), today we have the other thing in play. You can always count on the MSfM to tell you what you needed to know well after you needed to know it.

Treasury yields bounce, easing worries about a global economic slowdown

The 30yr Treasury yield continuum has been backing off from the 2.5% caution zone, which NFTRH called in advance (touting? Nah, just the truth) and now we have the MSM headlines going that way as well.

Goldilocks is in play as the Value/Growth ratio breaks down with pressure on the reflation trades. Plucky CRB index is still firm, but working on a key long-term resistance zone we track each week. Another positive correlation to the inflation created by the Fed and pushed by the government is the Copper/Gold ratio. While pulling back, it remains on trend as well.

With the 30yr yield having pulled back about as far as it should pull back to keep the larger inflation view in play the two lower panels are at a decision point about whether to stay bullish or turn. The at least temporary Goldilocks backdrop has already turned Value/Growth away from inflation and higher yields. So we have some mixed messages that need sorting out.

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