Good Morning on this best day of the week Wednesday,
Inauguration Day. Equities up, bonds up… bitcoin down. Not much movement though across any instrument. Not much news today.
Nice read from Matt Graham which kind of defines where rates are heading. We should know more shortly.
Turning to charts, we see Treasury yields in a clear consolidation pattern in the short term (higher lower and lower highs). The teal trendlines are converging by the end of the week, and the breakout will likely be inspired by the early read on stimulus negotiations. A negative breakout (red line) implies a revisit to the longer term uptrend (yellow lines). A positive breakout would be hard-pressed to make it all the way to the lower yellow trendline. Thus it could set bonds up to solidify some new floor in the low 1% neighborhood.
Bloomberg shared a quick note on President Biden’s first day. It’s worth the mention just to stay up to date… President-elect Joe Biden will start his term today with at least 15 executive actions that will reverse some of President Donald Trump’s key polices. The U.S. will rejoin the Paris climate agreement and the World Heath Organization, and stop construction of the wall on the Mexican border. Biden will also end the travel ban against some predominantly Muslim countries and revoke the permit for the Keystone XL pipeline. He will also introduce measures to reduce inequality and ease student debt burdens. The inauguration, under tight security, saw Biden take the oath of office at noon today.
Please remain safe and healthy, make today great.