Category: dollar

TNX Update

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With the upcoming FOMC meeting, it is worth revisiting the CBOE 10-Year Gov’t Rate (TNX). It appears that the 8,100 day window, which recently peaked is trying to find a direction. Will the bubble continue? In the actual data files, the 8,200 day window peaked on February 13; the 8,100 day window also peaked on February 13 — only to peak again on February 27. This indicates that we could be near a phase transition in the 10-Year rate. I am not yet sure what this graph implies. This is a very long term signal, since 8,200 days is about 33 business years. Remember that not all bubbles are followed by a crash.

tnx_10 tnx_11 TNX_12 TNX_13 TNX_14

The Great Bond Bubble

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As Martin Armstrong recently said (here), the current equity correction is a side show to the growing bubble in bonds around the world. Specifically, the 10-Year United States Treasury, as shown in the graphs below, is in the process of bubble formation. The Bubble Index: TNX (2520/5040/10080 Days) shows signs of a long term build-up in bond market tension. Imagine inflating a balloon, eventually it will pop. “When will it break?” is the question everyone is asking. I suggest that we will see it happen once either of the 2520, 5040, or 10080 day indices peak and roll-over. According to Armstrong, this will begin to occur on 2015.75. The Bubble Index does not rule out this date, only time will tell…