A Bearish Sign For Treasurys?

Tyler Durden's picture

It is no secret that throughout 2014 Bank of America has been actively urging its clients to join the most crowded short trade of the year, the 10 Year Treasury, which also happens to be one of the best performing asset classes year-to-date, and one which just hit 2014 highs. However, with the 10Y yield  plunging, BofA's chief technician, which as is widely known is another words for "momentum chaser" who has over the past year been branded as the new coming of the legendary Tom Stolper thanks to the inverse-accuracy of his calls, has changed his tune, to wit: "the trend in yield is lower." If there was something that could make us nervous about being long TSYs, this is it.

From Curry:

US 10yr yields target channel resistance, Stay bullish ESU4. 


risk assets coming under a bit of pressure this morning, US 10yr yields
are pushing lower. However, into 2.301%/2.267 (retracement and 8.5m
channel resistance), we look for a near term base and bounce. HOWEVER,
this bounce remains temporary and corrective. It would take a break of
2.473% to indicate a turn in the medium term trend, NOT BEFORE.


Of course, pointing out that technical "analysis" in a day and age when the only thing that matters for the so-called market, is what goes through the brain of a few addled Princeton career economists, is idiotic goes without saying.

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craus's picture

I was in $TLT 20 year treasury until the Feds beat it up last week.

Al Huxley's picture

They make all the charts fit standard technical patterns.  It's not technical analysis that's obsolete, it's common sense and fundamentals analysis that's gone the way of the dodo.

Beam Me Up Scotty's picture

Exactly, Goal Seeking 101!!  Which is why I am surpised we haven't seen a 10% correction in the Stawk Market because everyone sees that as a healthy sign that it should continue to go up, UP and AWAY!  They can pencil whip any number they want, why do you think gold has a boot on its throat?

NoDebt's picture

Hmmm.  I dunno, Al.  I'm going to need to see some confirmation from Dennis Gartman before I make up my mind.

huggy_in_london's picture

"Stay bullish esu4" ...

until they drop 3% in which case we will be bearish...

People still listen to any of these imbeciles?  They are merely morons that use the last print for the basis of their "investment advise" (aka guess)

drinkin koolaid's picture

"Stay bullish esu4" ...

until they drop 3% in which case we will be bearish...

And IF they rally back up 3%, hence we turn bullish....

MrButtoMcFarty's picture

Y'all said "market"....LOLOL

stutes33's picture

Hey techs, until this mess goes away in the world, you cant bet your bottom dollar rates are staying down here. 

Boston's picture

Nah, about a month or two ago, Curry screwed up by calling for the resumption of the bearish move that begain in mid-2013. It never happened. He's now simply corrected his error. 

Second, let's look at comparative value---the UK 10yr is now 2.25%, the Spanish 10yr is 2.22% (not a typo!) and Geman 10yr is 0.88% and Japan's is yielding only 0.49%. SO a US 10yr yield of 2.33% is a downright bargain. Until, this changes, I'm not only staying long, I'm adding to my positions on pullbacks in price. This has worked---very well for me---for almost a year.


ebworthen's picture


Technical analysis is meaningless until:

  1. The FED sets the prime rate at 6%.
  2. The FED ends any and all QE & stimulus.
  3. The FED is dissolved/eliminated/expunged from the face of the Earth along with every other central bank.
  4. The Treasury ends all back-door lending to banks (gambling houses).
  5. Zero bailouts of anyone/anything.
  6. Restore the rule-of-law.
  7. Restore the Gold/Silver standard to the currency.

Seven simple steps to sanity - that won't be restored for a very long time.

Until then technical analysis is just the blood pressure of a lunatic in a straight-jacket in a padded room.

buzzsaw99's picture

they are just encouraging gambling. over the short and medium term imo anything could happen to rates. over the long term it is the easiest one way trade in history.

JRobby's picture

Bank of America

(laugh track deafening)

If they would adapt Oakland Raiders colors and especially the logo, I would start to take them seriously.


LawsofPhysics's picture

Blah, blah, blah...

go ahead, raise rates motherfuckers!!!!

Pool Shark's picture



Ain't gonna happen.

[Long Treasuries...]

[Wake me when Gartman goes long...]


Kirk2NCC1701's picture

"raise rates".  So, to be clear... "Raise the real cost to fiat currency"?

IOW, although the "cost" to create said Fiat (entries in computer ledger) is vanishingly close to Zero, the imposed/fiat cost should be raised?

SheepDog-One's picture

But, but.....rate raise imminent and whatnot!

himaroid's picture

It's like taking candy from a baby. A retarded baby.

Notsobadwlad's picture

It is interesting that a low level and long-time Smith-Barney guy told me at a neighborhood shindig back in June after a couple of beers that he expected 10-yr interest rates to go down.

Usually his information is unreliable, but he must have heard it somewhere.