Bond Yield Blues

[(former)FormerSanDiegan]

Actually, some countries with fairly strong economies recently cut interest rates, as their currencies are very strong.

HWG, They’ve actually been raising rates in the Euro zone and elsewhere.

Per CNN …

NEW YORK (CNNMoney.com) — Interest rates are ticking higher overseas, raising concerns on Wall Street that U.S. rates will be pulled up along with them – but that may not necessarily be the case.

From Canada to England to Japan, central banks around the world have been raising rates amid growing concerns about inflation.

http://money.cnn.com/2007/06/06/news/economy/global_rates/index.htm?postversion=2007060618

[(former)FormerSanDiegan]

HWG –

Below is a link to Chris’ blog. Up until a couple days ago he was not blogging much, something to do with internet access at his new place in the boondocks. He has not yet exited stocks, but appears to be on the edge of his seat …

http://iamafuturestrader.blogspot.com/

[(former)FormerSanDiegan]

HWG –

Below is a link to Chris’ blog. Up until a couple days ago he was not blogging much, something to do with internet access at his new place in the boondocks. He has not yet exited stocks, but appears to be on the edge of his seat …

http://iamafuturestrader.blogspot.com/

[what_a_disasta]

I find this guy has some quitre interesting analysis:

http://market-ticker.denninger.net/index.html

Check it out. He is a good writer.

[what_a_disasta]

I find this guy has some quitre interesting analysis:

http://market-ticker.denninger.net/index.html

Check it out. He is a good writer.

[Chris Scoreboard Johnston]

Chris Johnston

Here is my take on today’s action, and I have also posted a chart on my blog displaying it. My long term timing system, which is based on weekly charts, so will not reveal itself until Friday’s close, still shows to be long. The huge jump in the bond yield is unquestionably the culprit in the recent drop. I also posted a chart a few days back showing how that looked at the time.

We are already at 2 standard deviations down in a big uptrend, so that is typically a good buy spot, much better than 2 std deviations down in a downtrend, which means nothing. Of the 5 stocks I bought at the beg of April, 4 of the 5 are substantially ahead, all by more than 10% and one is down 1%. They are holding up better than the mkt as a whole, which I why I bought them to begin with, I thought they would collectively.

I cannot add to my positions on this dip, because I am already so far above my entry, and I never pyramid upward, I put the full position on when I enter.

I expect the market to hold at these levels give or take a little bit, but if my model says to exit come Friday, I will do it on Monday morning. I doubt it will because several things have to happen, and one of them is very unlikely to move enough in just a few days to trigger the sell. My system which is longer term for stocks, does require sitting through retracements like this often. I probably have short term buys in my S&P system for tommorrow, but I have not run the program yet.

I have told my clients in the past as well as written about this pattern in stocks and bonds that we have right here, and it is bearish, make no mistake about it. However, often it goes on for several months before generating a big sell signal. This time could be different, but the commercials are still heavily long, and the seasonals still favor a move up, so I am long until my sell signal is generated.

It is of the utmost importance when volatility enters the market like this to keep emotions out of your trading decisions either way you are looking. I have been humbled too many times to get too carried away with my opinions, so I just follow my systems.

[Chris Scoreboard Johnston]

Chris Johnston

Here is my take on today’s action, and I have also posted a chart on my blog displaying it. My long term timing system, which is based on weekly charts, so will not reveal itself until Friday’s close, still shows to be long. The huge jump in the bond yield is unquestionably the culprit in the recent drop. I also posted a chart a few days back showing how that looked at the time.

We are already at 2 standard deviations down in a big uptrend, so that is typically a good buy spot, much better than 2 std deviations down in a downtrend, which means nothing. Of the 5 stocks I bought at the beg of April, 4 of the 5 are substantially ahead, all by more than 10% and one is down 1%. They are holding up better than the mkt as a whole, which I why I bought them to begin with, I thought they would collectively.

I cannot add to my positions on this dip, because I am already so far above my entry, and I never pyramid upward, I put the full position on when I enter.

I expect the market to hold at these levels give or take a little bit, but if my model says to exit come Friday, I will do it on Monday morning. I doubt it will because several things have to happen, and one of them is very unlikely to move enough in just a few days to trigger the sell. My system which is longer term for stocks, does require sitting through retracements like this often. I probably have short term buys in my S&P system for tommorrow, but I have not run the program yet.

I have told my clients in the past as well as written about this pattern in stocks and bonds that we have right here, and it is bearish, make no mistake about it. However, often it goes on for several months before generating a big sell signal. This time could be different, but the commercials are still heavily long, and the seasonals still favor a move up, so I am long until my sell signal is generated.

It is of the utmost importance when volatility enters the market like this to keep emotions out of your trading decisions either way you are looking. I have been humbled too many times to get too carried away with my opinions, so I just follow my systems.

[Anonymous]

Thanks for the link, w_a_d.

If Bill Gross is truly now bearish on long bonds, awesome! Tomorrow may be an interesting day.

[Anonymous]

Thanks for the link, w_a_d.

If Bill Gross is truly now bearish on long bonds, awesome! Tomorrow may be an interesting day.

[Anonymous]

It’s true!

http://www.reuters.com/article/bondsNews/idUSN0749402420070607

[Anonymous]

It’s true!

http://www.reuters.com/article/bondsNews/idUSN0749402420070607

[Anonymous]

“…Not only is the firm trimming duration…”

Does this mean that PIMCO is selling longer maturity Treasuries?

[Anonymous]

“…Not only is the firm trimming duration…”

Does this mean that PIMCO is selling longer maturity Treasuries?

[HereWeGo]

Absolutely, there are reasoned opinions, and reasonable folks, that differ with my stock-market-crash-upcoming and Second-Great-Depression-soon-thereafter perspective.

Actually, last year I shared that perspective. I lost out on a heck of a lot of gain with that p.o.v.

Hey, how does it feel to have Ben Bernanke and George Bush on your side?

I definitely like Bernanke on my team. The other guy … meh. The 15% rate is helpful, but the potential upward pressure on long term rates from the profligate spending is not.

[HereWeGo]

Absolutely, there are reasoned opinions, and reasonable folks, that differ with my stock-market-crash-upcoming and Second-Great-Depression-soon-thereafter perspective.

Actually, last year I shared that perspective. I lost out on a heck of a lot of gain with that p.o.v.

Hey, how does it feel to have Ben Bernanke and George Bush on your side?

I definitely like Bernanke on my team. The other guy … meh. The 15% rate is helpful, but the potential upward pressure on long term rates from the profligate spending is not.

[Author]

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