S&P 500 vs. 10 Year Treasury Yield

Expanding more on yesterday’s yield of the S&P 500 (INDEXSP:.INX) and the 10 year Treasury, let’s see what we can find out.

You can see this S&P 500 yield vs. Treasury yield has only been a more recent event since the late 1970’s. The chart below highlights that.

The next chart will look at 2008 to present to get a close look at this.

We can see this cross has happened only 3 times. In March of 2009, it signal a bottom in the market. Which of course was the peak of the financial crisis. This happened again during second half of 2011 &2012, which was the US debt downgrade and Eurozone crisis. It is happening again now, which is due to the Fed, Oil & China.

What I tried to show on the chart below, is the bottom point of the market with the gray dashed lines. You can see when the yield on the S&P peaked it tended it to signal the bottom of the market. This would make perfect sense since yield and price are inversely correlated.

Upon conclusion it would seem that perhaps we may have peaked on the S&P 500 yield. We will see…

This was originally shared at Mott Capital Management 

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