Rate of Change in Eurodollars Signalled 10-Year Yield Rollover
Subscribers were able to front run the rollover in U.S. yields as the rate of change in the eurodollar complex signaled a higher probability move. This as knock-on effects to yield proxies like USDJPY, TLT, XLU, XLRE etc.
This exerpt is taken from "The Powell Put Pause" by The Macro Strategist:
"Since January 14, the SPX is up 3.84 percent higher; but due to TACVOL's dynamic design, the range has been expanding since given as it takes in data. TACVOL score is bullish, and the range top is currently 2,730.
The frustrating part is it conflicts the macro which should be supporting higher risk assets. Risk management is key.
The move in policy expectations were hinted in Monday's "Charts to Ponder," which subscribers receive at the beginning of the week.
The EDZ 2019 (eurodollar) has tightened after a massive pivot in November, which caused yields to collapse. However, the 7- and 20-day rate of change is beginning to drift higher.
The 7-day ROC is above to flip from negative to positive and could see an inflow into eurodollars. This would be net-negative for the U.S. dollar; 10-year yield would roll over."
Current near-term TACVOL range for SPX: 271.81/246.52; 1.42 score (bullish)
This exerpt is taken from "The Powell Put Pause" by The Macro Strategist:
"Since January 14, the SPX is up 3.84 percent higher; but due to TACVOL's dynamic design, the range has been expanding since given as it takes in data. TACVOL score is bullish, and the range top is currently 2,730.
The frustrating part is it conflicts the macro which should be supporting higher risk assets. Risk management is key.
The move in policy expectations were hinted in Monday's "Charts to Ponder," which subscribers receive at the beginning of the week.
The EDZ 2019 (eurodollar) has tightened after a massive pivot in November, which caused yields to collapse. However, the 7- and 20-day rate of change is beginning to drift higher.
The 7-day ROC is above to flip from negative to positive and could see an inflow into eurodollars. This would be net-negative for the U.S. dollar; 10-year yield would roll over."
Current near-term TACVOL range for SPX: 271.81/246.52; 1.42 score (bullish)
