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Strategies & Market Trends : Win Lose or Draw : Be A Steve, Make A Call -- Ignore unavailable to you. Want to Upgrade?

To: Softechie who wrote (11193)	5/8/2003 2:12:11 PM
From: Softechie	Respond to of 11447

Intermarket Relationships While the 10-yr Note has slipped off its best level of the day following poor auction results, this segment of the curve has put together a very strong performance over the last 6+ weeks. A chart of the 10-yr yield, currently at 3.65% (which moves the opposite of prices) shows the substantial decline and the fact that it was not far from the Oct/March lows earlier today. This plunge in yield has come at the same time that the S&P 500 has rallied roughly 19%. Talk of potential deflation has been cited of late as the reason for the yield drop but traditionally these markets move in unison with divergences not sustained for an extended period of time. The Dollar, which also traditionally moves in unison with stocks, has also diverged of late. Commodity prices (lumber, copper, cotton), which are said to provide a read on the performance/expectations for the economy, have not established an uptrend.