HI people welcome to Decrypters
So We have 3 charts DXY , US10Y & T-NOTE BOND
THE LINK BETWEEN 3 CHARTS IS VERY BASIC
Lets Discuss BONDS first
The Bonds are About to Decrease in value Now bonds consist of 3 things
1-Face value (Principal Investment)
2-Maturity ( Pay back time, lets say 5 yrs )
3-Copoun rate ( Interest on Face value, lets say 7 % )
The interest on coupon will be 7% per year for 5 years At where bond will be Mature.
Now there is a Basic rule of Supply & Demand of Economics if a Bond prices fall the yield will Rise , Which Also means USD will be strengthen
Why This Happens ? Simple , Because Govs is willing to pay High for less Bond value , Meaning An investor can get higher yields By paying less bond prices
This Also may "INDICATES" The direction of economy and investors confidence which Is key for interest Rates
So We have 3 charts DXY , US10Y & T-NOTE BOND
THE LINK BETWEEN 3 CHARTS IS VERY BASIC
Lets Discuss BONDS first
The Bonds are About to Decrease in value Now bonds consist of 3 things
1-Face value (Principal Investment)
2-Maturity ( Pay back time, lets say 5 yrs )
3-Copoun rate ( Interest on Face value, lets say 7 % )
The interest on coupon will be 7% per year for 5 years At where bond will be Mature.
Now there is a Basic rule of Supply & Demand of Economics if a Bond prices fall the yield will Rise , Which Also means USD will be strengthen
Why This Happens ? Simple , Because Govs is willing to pay High for less Bond value , Meaning An investor can get higher yields By paying less bond prices
This Also may "INDICATES" The direction of economy and investors confidence which Is key for interest Rates