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Strategies & Market Trends : Trading futures based on intermarket trends

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To: lee0 who wrote (57)2/27/2002 8:39:56 AM
From: fut_trade  Read Replies (1) of 73
 
"Have you found any short term relationships that are good setups for a short?"

Today, I'm a bit bullish and would like to buy the SP on a decent pullback.

To keep things simple, I'm thinking of just using the Fed reported yields on the 10 year treasury notes:

federalreserve.gov

to look for trends between the SP and interest rates. The Fed only reports the close. So possible trends could involve lower or higher closes of the 10 year T-note yield. I'm also thinking of applying %R to the T-note yield.

The yield has made 2 consecutive higher closes. From 1982 to May 2000, this has been bearish for the market. But over the last couple of years, this has been slightly positive or neutral.

2 consecutive lower closes of the yield has been very bullish from 1982 to May 2000. Over the last 2 years, however, the trend has been neutral.

It seems that the correlation between interest rates and the stock market is becoming weaker, and should be used carefully in the near future.
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