Below is a chart of the 10 year Treasury yield monthly since 12/31/1980, default nominal model, peaks and troughs, no pinning. I prefer to use yields rather than prices for Treasuries because the lows coincide with lows in stocks. I’ve looked at it both ways and it really doesn’t matter much.
All of the long-term charts I have posted recently (stocks, crude, Treasury yields) are starting to look similar with big troughs in 2020. Commonality in highly (or negatively) correlated asset classes can be used as cross-confirmation when trading or investing.
Weekly picture (corrected chart from earlier post). Does this bode well for stocks? It’s a good bet if the highs aren’t already in, they soon will be.
Daily view. Strong like bull.
Here’s the money shot. The slope of the Treasury curve is flattening dramatically due to short rates rising and long rates falling. When the slope gets near zero or negative, bad things happen (recessions). At this rate, we’ll be there by fall but the market will start pricing this in sooner. We are very late in the cycle for everything except fear and adult diapers.
Treasuries are like copper. It’s one of the smartest asset classes around and typically leads at major turning points. Even if you don’t trade bonds, it’s a market that’s worth watching.