There’s lot of information floating around freely on the intertubes and when I saw this one ‘hit’, I had to pause and read a bit further. In PRICE (with some amount of confirmation) there is truth, at least as far as the saying goes. While this money manager asserts the bearish EQUITY case is clear, non-confirmation means there’s little to NO belief. TINA, FOMO aside, the bit on bonds then is, in my view, worth a quick ‘share’. From Potomac HERE
…U.S. Fixed Income
The 10-Year Treasury Note closed below its 10-week moving average into the 130-131 zone of polarity that buyers are now defending. While price closed out the week below declining 10 & 40-week moving averages, buyers have yet to throw in the towel at these levels and are being tested again. Yields closed higher on the week but still have some headroom to get to the 1.75% resistance level. Until there’s any material development in these highlighted levels, we maintain a neutral fixed income bias.
Apart from 2-Year Yields, price action remained muted across the curve. 2-Year Yields regained all the loss from the prior week, closing out this week at 68.8bps. 5-Year Yields closed higher on the week but were unable to recoup the downside action from the week prior.
With that in mind — APART FROM 2yy — there IS an auction this afternoon so it will be interesting to see IF there’s a(nother) Field of Dreams moment in UST market. Here are 2yy HOURLY over most of DEC and clearly can see them up nearer the cheap end of the range
I’m a fan of pictures and how rates fit into global macro … One point here IS there is simply very little to be concluded from (lack of)action in RATES space here and now.
For somewhat more (about less) see HERE and for some other reading material to help pass some time before helping Dept of Tsy place 2s, see HERE.