Submitted by ec0n0m1x t3_10feogg in wallstreetbets
To all degenerates: Since my last post about the yield inversion, the market took a -10% dive as I expected, it then rebounded, as a typical bear market rally.
Hold your horses, it's going to get uglier pretty soon. See, the bond yield inversion is the best leading indicator for the stock market.
Here's a quick course:
- The standard yield inversion is 2 years vs 10 years, which almost always indicate a recession. That was inverted in December 2021 and carnage followed in 2022.
- The "imminent disaster" yield inversion is the 3-month vs 10 years. That's currently sitting at 1.3%! 3-month investors are asking 4.7% of return while the 10 years are asking 3.4%. They see something super nasty coming very soon.... on a biblical proportion.
As a reference for yield inversions:
- 2000 crash: 0.7%
- 2008 crash: 0.5%
- Now: 1.3%
For my technical homies, we're hitting the upper-trend channel on the spot.
