TNX nailed our 22.94 target last week, completing the move we forecast in December when the red trend line shown below broke down [see: Dec 26 Update on Bonds.]It has taken considerably longer than originally anticipated because the more violent downdrafts in 10Y rates prompted violent equity sell offs. Some cooling-off periods — long, drawn-out bounces — were necessary.
While the rising purple channel has now been fleshed out, our price charts indicate the move might not be complete — a view shared by our yield curve model. We’ll take a fresh look at the big picture, and the dramatic move it implies for stocks.
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