For several months there’s been an inverse relationship between U.S. stocks and U.S. government debt yields/rates. The recent manic U.S. stock rally since late October corresponds with the U.S. 30 – year Treasury yield (TYX) decline. Near – term the TYX appears it could be making a bottom.
The daily TYX chart courtesy of Trading View illustrates what’s been happening.
TYX has moved just below a Fibonacci .618 retracement of the 06/26/23 to 10/23/23 rally. Just below the recent low is chart support from two August 2023 bottoms. This is a logical area where at least an intermediate bottom could form.
Supporting this theory is the daily RSI which reached the oversold zone on 12/06/23. MACD – Histogram has a bullish divergence.
The decline from 10/23/23 to 12/06/23 in Elliott wave terms appears impulsive. If so this implies an intermediate move up in TYX, then another decline. If a rally does develop soon, it’s possible the entire TYX decline from October could terminate in late December or early January2024.
Four Dimension Trading 