Why 10-year bond rate is important?
It is the second time in a couple of months that the 10-yr Treasury rate crossed 3% mark. Why is this so important? There are several reasons for that.
When most of the analysts establish the price targets for a company, they use the so-called discounted cash flow model (DCF). The idea behind their calculations is indeed very simple: they try to predict the earnings of the company for the foreseeable future and then discount a cash flow by the interest rate. It this interest rate that determines the “discount” factor, and greater the interest rate – greater the discount factor, and therefore smaller the price target becomes.
Of course, the increase in 10-years Treasuries rate defines the overall interest rate environment for corporate bonds, and while this dependence is not that simple, 10-years Treasury rate has a direct impact on the allocation to fixed income securities by large market players (pension funds, insurance companies). As the interest rates rise, many such funds shift their assets from a stock market to fixed income securities.
Both these factors will have a definite negative impact on the behavior of the stock market and combined with the expected (and announced) two additional interest raise increases this year, the market can experience a significant downturn. In no way, it is a prediction – but please watch this rate carefully.
SPY sees MACD Histogram crosses below signal line
SPY saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on May 28, 2025. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 53 instances where the indicator turned negative. In of the 53 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The 10-day RSI Indicator for SPY moved out of overbought territory on June 11, 2025. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 45 similar instances where the indicator moved out of overbought territory. In of the 45 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 67 cases where SPY's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SPY declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on June 03, 2025. You may want to consider a long position or call options on SPY as a result. In of 68 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where SPY advanced for three days, in of 366 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 433 cases where SPY Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
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