2012 appears to be a great analogue for the current volatility in the treasury market, and might provide clues on what comes next if rates fall through their recent support level. Spoiler alert: it involves the #Fed. Here's a thread of the impact on diff markets.
$TNX $SPX
$TNX $SPX
I'll start with $SPX. When $TNX broke its support, equities experienced a >10% correction. This was after a 20% drop a year earlier that started this higher vol period.
When $TNX broke support, $DXY saw a strong move up until the fed stepped in with #QE3.
$AUDJPY revisited the lows.
$GLD
And with the bond market signaling a deflationary environment, $CL_F sold off significantly (inflationary asset).
$BKX underperformed $SPX until #QE3 announced. This is very analogous to the current situation and something to keep an eye on.
While history doesn't necessarily repeat itself, it appears to be rhyming (so far). Just a few things i'm watching if interest rates break through their current support. And this time there is less room to fall before they enter negative territory…
