2 year treasury bond yield and 3 month T-bill yield

If you’re a nerd, you find this amazing

2 year Treasury bond yield continues to diverge T-bills Well, this nerd is amazed by it (and several other out of whack macro indicators), at least. The 3 month T-bill yield (close companion to the Fed Funds rate) continues to steam upward in a divergence to the 2 year Treasury bond yield. Or put another way, the 2 year Treasury yield is negatively diverging in … Continue reading If you’re a nerd, you find this amazing

2 year treasury bond yield, S&P 500 and 3 month T-bill yield

Putting the 2 year Treasury bond yield in context

The 2 year Treasury bond yield, T-bill and S&P 500 beg multiple interpretations I called the 2 year Treasury bond yield the most important chart in the world the other day to poke fun at those who use such hyperbole to make a (likely biased) point, but  also to illustrating a likely topping situation in the 2 year yield. Below is the 2 year Treasury … Continue reading Putting the 2 year Treasury bond yield in context

5 year breakeven inflation rate

5 to 30 year ‘Breakeven Inflation Rates’ paint a different picture than RINF

‘Inflation expectations’ ETF out of phase with most ‘Inflation Breakevens’ Here is what RINF does, per its creator… ProShares Inflation Expectations ETF seeks investment results, before fees and expenses, that track the performance of the FTSE 30-Year TIPS (Treasury Rate-Hedged) Index. I am sure the inputs are different, but RINF tracks the St. Louis Fed’s 30yr Breakeven Inflation rate most closely. But even there, per … Continue reading 5 to 30 year ‘Breakeven Inflation Rates’ paint a different picture than RINF

Yield Curve: Peak Fed? [w/ edit]

As per one of my favorite ‘not taking the analysis too seriously’ market memes… …we note that global casino patrons are good and pissed, scared and downright apoplectic. Especially overseas as the US exports inflation to the rest of the world with the delivery vehicle being the chronically strong US dollar. The Fed is in control. All eyes on the great monetary authority which shall … Continue reading Yield Curve: Peak Fed? [w/ edit]

Au/ES, Au/HG & Au/Ag ratios (& USD)

Gold’s ratios to stocks, copper and silver (daily charts)… “It’s a process” he parroted for months on end. Gold/ES continues its recovery and bodes well for the counter-cyclical view from a stock market vantage point. Gold/Copper got whacked yesterday but thus far clings to its pattern. Whether or not that pattern fails, the trends are up and thus, against the cyclical inflationary view from this … Continue reading Au/ES, Au/HG & Au/Ag ratios (& USD)

Does the Copper/Gold ratio look good to you?

Me neither… For “best of breed” top down analysis of all major markets, subscribe to NFTRH Premium, which includes an in-depth weekly market report, detailed market updates and NFTRH+ dynamic updates and chart/trade setup ideas. Subscribe by Credit Card or PayPal using a link on the right sidebar (if using a mobile device you may need to scroll down) or see all options and more … Continue reading Does the Copper/Gold ratio look good to you?

Interesting Gold/Commodity correlations to yields

Copper/Gold and Oil/Gold correlated with the 10yr yield From yardeni.com, a visual representation of one implication of the Copper/Gold ratio, which I often make a big deal about. If the Copper/Gold ratio has broken down for real (I believe it has) then yields are going to reverse, along with the inflation trades. That’s a theme I’ve had going for about a year now, but this … Continue reading Interesting Gold/Commodity correlations to yields

US Treasury bonds are worse than Junk

Junk bond ETF outperforms both Treasury and ‘investment grade’ (IG) bonds As would be expected, nominal junk (HYG) is pretty bearish along with the rest of cyclical/risk ‘on’ markets. It’s in a 2022 daily chart downtrend. With the tiring inflation story still eating away at Treasury bonds, it’s logical I suppose that Junk is strong in relation to T bonds. But what of Junk vs. … Continue reading US Treasury bonds are worse than Junk

Yield Curve steepener in play?

The 10yr-2yr yield spread has taken out its previous short-term high Thus, it’s certainly a candidate to begin the steepener that seems only a matter of (diminishing) time. Notice how it took out the previous high and also the July high. Here’s the link at CNBC where you can check the status any time you’d like (assuming you’ve got a little nerd in you). The … Continue reading Yield Curve steepener in play?

2 Horsemen of the (macro) Apocalypse ride on…

The US dollar and the Gold/Silver ratio are bulling together… And per the Seinfeld bad chicken episode, “that’s not gonna be good for anybody.” Here we see Uncle Buck (DXY) doing what he has been doing since he began diverging the inflation hysteria well over a year ago. And his fellow rider doing similar. For anyone new to this, the ratio of gold to silver … Continue reading 2 Horsemen of the (macro) Apocalypse ride on…

A message from Doctor Copper and stodgy old man Gold

Doc and the old man: A likely false dawn amid summer relief Many indicators became overdone to the downside in June and July. Certainly sentiment indicators did. But so did cyclical/counter-cyclical indicators. One major tankage was in our often reviewed Copper/Gold ratio (a ratio of a cyclical and inflation sensitive metal vs. a counter-cyclical and less inflation sensitive metal), which persisted in indecision mode all … Continue reading A message from Doctor Copper and stodgy old man Gold

high yield credit spreads

High yield credit spreads continue to rise

Rise in high yield credit spreads threatens recession A rising spread indicates disfavor toward junk bonds (oh so favored during speculative risk ‘on’ phases) and this behavior can eventually either grind its way toward economic recession or spike its way there (ref. 2020). Here is a longer-term view. Whether it grinds (2000) or spikes (2008 & 2020) a continued rise would eventually be a recession … Continue reading High yield credit spreads continue to rise

US dollar & Gold/Silver ratio

This is how an inflation phase ends It’s called the bust that follows an inflated boom. The US dollar and Gold/Silver ratio traditionally ride together to bring it on. The current backdrop is as we’ve allowed for and even anticipated in NFTRH (against heavy cash I am positioned in the stuff that is not inflation-dependent, and it is working today). It’s a whiff of ‘Goldilocks’ … Continue reading US dollar & Gold/Silver ratio