On February 24, 2024, selected charts illustrated 10-Year Note futures trading positions relative to the 30-Year U.S. Treasury Yield. Futures trader positions and yield have remained relatively unchanged up to this point. It has been observed that an increasing number of extremely large block trades have been crossing the tape as a falling wedge forms in the chart shown below. Since late September 2023 volume has been significantly larger than what occurred in 2007, 2008, and late 2018 combined. This would align with the expectation that bond yields will fall as stock markets decline, regardless of what the Federal Reserve does.
Note that the chart shown below is for research purposes only and is not a recommendation.
As always, volume, not price, is the principal guarantor of the markets direction.
Richard Ney, Making it in the Market, 1975, page 129
Stock chart courtesy of StockCharts.com.
