Another Dire Warning For Stocks? It was in 2000 & 2007

by Kimble Charting

Are stocks receiving another dire warning, similar to the message received in 2000 & 2007? Very possible!

This chart looks at the yield on the 10-year yield, inverted. This chart now resembles bond prices. The inverted yield has remained above a key support line for the past 25-years.

In 2000 & 2007 the inverted yield created a bullish falling wedge, with the apex of the wedge at 25-year rising support. When a breakout took place in 2000 & 2007, stocks were peaking and they soon tanked.

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The inverted yield has been falling hard the past few years, bringing it back to test 25-year rising support. Over the past couple of years, the inverted yield looks to be forming another bullish falling wedge, with the apex of the pattern taking place at support.

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This week it is making an attempt to break out from this bullish pattern at (1), similar to the price movement in 2000 & 2007!

In 2000 & 2007 when breakouts took place, stocks peaked and tanked in the months ahead. Will it be different this time???




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