Bearish Head & Shoulders Breakdown in Yields
RISING RATES! RISING RATES! RATES MUST GO UP! RATES CAN'T GO LOWER! BUY THE BANKS! RISING RATES!
Okay, you get the point. That's the battle cry of pundits these days. However, rather than try to predict the future, I like to keep it simple and just analyze the charts. So, what I see, being the simple minded creature that I am, is a simple head and shoulders formation on 10-year yields (there's also one on 30-year yields). We've broke down below the neckline, which is bearish for yields (and bullish on bond prices). That neckline is sloping upwards, so the level required to invalidate this pattern is about 2.875 and rising.
I don't trade bonds directly, but I do hold some bond ETF's in my IRA's. Specifically, I'm holding VCIT, VCLT, HYLD, SHYG, HYXE, and EMLC.
PS - Marked this as bearish because it's a chart of yields, on which I'm bearish. By extension, that means I'm bullish on bond prices.
Okay, you get the point. That's the battle cry of pundits these days. However, rather than try to predict the future, I like to keep it simple and just analyze the charts. So, what I see, being the simple minded creature that I am, is a simple head and shoulders formation on 10-year yields (there's also one on 30-year yields). We've broke down below the neckline, which is bearish for yields (and bullish on bond prices). That neckline is sloping upwards, so the level required to invalidate this pattern is about 2.875 and rising.
I don't trade bonds directly, but I do hold some bond ETF's in my IRA's. Specifically, I'm holding VCIT, VCLT, HYLD, SHYG, HYXE, and EMLC.
PS - Marked this as bearish because it's a chart of yields, on which I'm bearish. By extension, that means I'm bullish on bond prices.