Spain Stalling – Watching the Ten Year

• Posted by Alex
• on January 31st, 2013

Trader and Technical Analyst Alex Tarhini is getting worried about the signals we’re getting from Spanish Government Bond Yields. I think this is something we cannot ignore.

***

As little press as it is getting, the European markets have been on fire for the last six months. The $EURUSD has been in a powerful uptrend and bond spreads have compressed. It has been quite a forceful move thus far. But with the Euro tagging 1.35 against the US dollar and multiple European indices getting to very overbought RSI levels, you have to ask yourself when this thing will end. I think the answer lies in the Spanish ten year yields. They have reached the critical sub-five percent level (~4.87%) and are reacting to it. I think this is where the European trade gets difficult. The trend is still in tact, but the catalysts are withering dry.

Take a look at Spanish 10 Year Yields.

 

Now here is how close the markets have been following bond yields.

 

Make sure to follow Alex on Stocktwits and Twitter @TarhiniTrade

Tags: $EWP $FEZ $EWG $EURUSD

Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.

blog comments powered by Disqus