• 3 hours U.S. Sanctions Are Wreaking Havoc On Iran's Economy
  • 6 hours Billionaire Hedge Fund Legend Bets Big On Gold
  • 8 hours Will Facebook’s Crypto ‘Libra’ Challenge Bitcoin?
  • 24 hours Will The Stock Market Really Crash If Trump Isn’t Re-Elected?
  • 1 day For American Businesses, The Fairy Tale Is Already Over
  • 1 day Market Mayhem Sparks Worries Of A Looming Recession
  • 1 day Closure Of World's Most Important Waterway Could Be An Economic Disaster
  • 2 days Would You Give Up Your Privacy For A Few Bucks From Facebook?
  • 2 days The $3.2 Trillion Caspian Caper
  • 3 days The Billion-Dollar Brands Behind The Street Fashion Coup
  • 3 days Gold Miners See Massive Upside Potential As Precious Metals Climb
  • 4 days Colorado Rakes In $1 Billion In Pot Revenue
  • 4 days London Metals Exchange Bars Day Drinking On Trading Floor
  • 5 days Tax Cuts And Cheap Money Push The U.S. Budget Deficit Closer To The Edge
  • 5 days Fake “Made In Vietnam” Certificates On The Rise As China Looks To Skirt Tariffs
  • 5 days Kremlin Moves To Dump The Dollar
  • 5 days How Climate Change Could Lead To A Global Economic Crisis
  • 6 days What Happens When Beijing Is Biggest Owner Of US Debt?
  • 6 days Investors Are Betting Big On Boozeless Bars
  • 6 days Why China Won't Back Down In Trump's Trade War
Strong U.S. Dollar Weighs On Blue Chip Earnings

Strong U.S. Dollar Weighs On Blue Chip Earnings

Earnings season is well underway,…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

  1. Home
  2. Markets
  3. Other

Pigs Break Out With Yields

It is too early to call it a confirmed breakout, but the Bank index has popped above cyclical bull market highs. Weekly MACD and RSI both look good.

$BKX KBW Bank Index INDX

The monthly chart shows that BKX has been consolidating above a long-term support area for the better part of 2 years.

$BKX KBW Bank Index INDX

I had thought the BKX had a decent chance of topping out and a one day (Tues.) pop above resistance does not negate that possibility. A lot will depend on interest rates. The Pigs like to be fed (no pun intended) cheap money and eventually churn it out into the economy at an 'interest rate differential' mark up.

The 30 year yield over threw to the downside and could be over throwing to the upside now, to even out the distortion.

$TYX 30-Year T-Bond Yield INDX

Or, the 'rising rate' hype could be real and the bond bull could be over. That will not be known until/unless the Continuum © breaks the monthly EMA 100 one day.

$TYX 30-Year T-Bond Yield INDX

In the meantime, if yields do continue to rise (whether the yield curve rises or not, assuming the Fed remains lame on the Funds Rate) the banks will probably make a run for the resistance level shown on the second chart above.

Gold on the other hand, which we have shown to have been 'anti' the Pigs, would need the yield curve to also be rising in a rising nominal interest rate environment or there would be more trouble in Bugville. Here is weekly BKX and Gold.

$BKX KBW Bank Index INDX

These items that have been 'anti' each other for so long would continue to be so if the chart below fails. If not, gold can rise with the Bank index.

Here is the current daily view of said yield curve, using the 10yr-2yr spread. The modest uptrend began in February and continues to today.

$TNX:$UST2Y 10-Yr T-Noe/2-Yr Treas Yld (EOD) INDX

A weekly view lends longer-term perspective.

$TNX:$UST2Y 10-Yr T-Noe/2-Yr Treas Yld (EOD) INDX

 


Subscribe to NFTRH Premium for your 25-35 page weekly report, interim updates (including Key ETF charts) and NFTRH+ chart and trade ideas or the free eLetter for an introduction to our work. Or simply keep up to date with plenty of public content at NFTRH.com and Biiwii.com. Also, you can follow @BiiwiiNFTRH.

 

Back to homepage

Leave a comment

Leave a comment