UST2Y 2-Year Treasury Note Yield Weekly Chart; Expansion Pattern (Megaphone) Ends; 5.05% Yield Comparing Back to 2006; 40-Year Bull Bond Market Ends with Pandemic

The 2-year yield jumps above 5% to 5.05% comparing back to the summer of 2006 when yield was at 5.17% with a high at 5.24%. This level, 5.00% to 5.24%, offers strong very long-term resistance (a ceiling for yield).

It would be reasonable to expect a back kiss down to the breakout trendline at 2.5%-ish. No one expects this to occur. If the stock market collapses, people will be buying notes and bonds for perceived safety driving yields lower.

It is a big deal that yield breaks out of the megaphone but it may face a few months or years of resistance at 5.24% until the big explosion higher in yields occurs.

A Gary Shilling deserves credit for calling the long-term bond bull market back in the 80's and 90's. Analysts scoffed at his call ridiculing his analysis but as the century changed over, Shilling was proven right; everyone else was wrong. Wall Street is a group of greedy lemmings. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 10:34 AM EST: The 2-year yield drops to 4.98% back below 5%. If you bring up the daily chart, the MACD has some more gas although the chart in general is topping-out like the weekly chart above, so the near-term top in yields is likely occurring over the coming days. 

Note Added Friday Morning, 3/10/23, at 7:18 AM EST: The US stock market collapses. The 2-year yield received the negative divergence spankdown in quick order losing 20 bips in a flash an unbelievable move. The 2-year yield is at 4.82%. The 10-year is at 3.85%. The 2-10 spread is at -97 bips becoming less inverted after the -110 basis point drop. A new hook pattern forms and heads higher for the 2-10 spread ushering in the US recession going forward, unless the yield curve becomes more inverted and drops below -110 bips which is already rare multi-decade lows.

Note Added Monday Morning, 3/13/23, at 5:21 AM EST: The US yields plummet on the Silicon Valley Bank failure; 2-year 4.35%, 5-year 3.80%, 10-year 3.61%, 30-year 3.67%. The 2-10 SPREAD UN-INVERTS UP TO -74 BASIS POINTS. IN ONLY 3 DAYS, THE 2-YEAR YIELD FALLS OVER 70 BIPS THE MOST SINCE THE 1987 STOCK MARKET CRASH. THE 2-10 SPREAD HOOK PATTERN LAUNCHES HIGHER FROM -110 BIPS TO -74 BIPS SIGNALING THAT THE US RECESSION IS LIKELY CLOSER THAN ANYONE REALIZES.