10-Year Yield Tests Weekly Risk Level as the Dow Stabilizes

The yield on the 10-Year US Treasury tested 2.571 versus this week’s pivot at 2.598. Gold reaches $1229.5 during Monday’s trade. Crude oil is below my annual pivot at $77.05 with Monday’s low at $74.86. The euro declined to 1.2737 on Monday. The Dow stayed well above my weekly value level at 10,055, but also stayed below my annual pivot at 10,379. The 30-Year Fixed Rate Mortgage widens versus Treasuries. The NAHB Housing Market Index dips to 13.

10-Year Note – (2.579) My annual pivot is 2.813 with a weekly pivot at 2.598 and daily risky level at 2.523. My annual value level is 2.999 with quarterly and semiannual risky levels at 2.495 and 2.249. (Click to enlarge)

Courtesy of Thomson / Reuters

Comex Gold – ($1226.4) Weekly, quarterly, monthly and annual value levels are $1159.3, $1140.9, $1133.2 and $1115.2 with semiannual and daily pivots at $1218.7 and $1226.8, and semiannual risky level at $1260.8.

Courtesy of Thomson / Reuters

Nymex Crude Oil – ($75.18) My daily pivot is $74.03 with weekly and annual pivots at $76.86 and $77.05. My monthly and semiannual risky levels are $80.02 and $83.94. My quarterly value level is $56.63.

Courtesy of Thomson / Reuters

The Euro – (1.2816) Quarterly and monthly value levels are 1.2167, 1.1486 and 1.1424 with a daily pivot at 1.2826, and weekly and semiannual risky levels at 1.3223 and 1.4733.

Courtesy of Thomson / Reuters

Daily Dow: (10,302) My weekly value level is 10,055 with daily and annual pivots at 10,270 and 10,379, and monthly, semiannual and annual risky levels at 10,439, 10,558 and 11,235. My quarterly value level is 7,812. My annual risky level at 11,235 was tested at the April 26th high of 11,258.01.

Courtesy of Thomson / Reuters

The 30-Year Fixed Rate Mortgage is Well Above the Yield on the 10-Year US Treasury - The 30-Year Fixed Rate Mortgage is at a new low for the cycle at 4.44%, but with the 10-Year yield at 2.60 the spread has widened to 184 basis points from 115 on March 31st when the Federal Reserve stopped buying mortgage backed securities and GSE debt. A difference of 69 basis points is a game-changer for homeowners looking to refinance. At 115 over today’s mortgage rate would be 3.75%, which would definitely spur mortgage refinancings.

The NAHB Housing Market Index slipped to 13 from 14 in August - This slippage is do to the “unusual uncertainties” in today’s economy including; the lack of job creation, inaccurate appraisals, competition from the large number of distressed properties on the market, and tight consumer lending conditions. 87% of survey respondents said that their market was negatively impacted by foreclosures.

Disclosure: No positions