It is as if everybody was expecting inflation to cool down as indicated by the buying activities on the 10 Years and by the selling pressure on copper.
The yield comparison indicates that the overvaluation level is down to $3930.
We can also say that for the market to erase their current overvaluation, the 10Y rates should be dropping back down to 3.6%.
It is interesting to see that the Mclellan summation index has already rolled. Past moves have indicated pullbacks from tops. The Blue arrows indicate a few non-conclusive signals that were issued during the strong uptrend of 2021.
Conclusions:
The PPI (Producers Price Index) will be issued before the open today and could set the tone for the 10Y rates.
Below are a few trade ideas. If the PPI does not show that inflation is easing down, then this market is set to weaken back to at least $3930..
