If a multi-presidential-term chart of the U.S. 10-year Treasury yield spanning four decades is any indication, a bottom for the chart may be in store.
"It starts with Reagan, with that head and shoulders top — it really starts with Carter into Reagan — and works its way lower. So you have this Reagan head and shoulders top into a potential Trump double bottom," Rich Ross, Evercore ISI's head of technical analysis, said Thursday on CNBC's "Trading Nation."
The yield on the 10-year note has fallen this year and in Friday trading was staying below 2.2 percent. Interest rates are still near historic lows even as the Federal Reserve is in a tightening cycle. Ross pointed out that the 150-month moving average over four decades acts as a resistance for the entire downtrend the yield has been in.
This, along with low growth, low inflation and low oil prices, doesn't "exactly have this whiff of economic vitality," Ross said, adding that this is precisely why investors will instead invest in growth stocks.
"It's this bitter irony here that the low yields are pushing people out onto the risk spectrum, and we have this barbell of a market with defensives, health care, staples and utilities leading because of their yields on one end, and growth stocks — high beta, risk — on the other end. So how do we square this? I'm not 100 percent sure. Right now, I would still sell growth stocks and I would still buy bonds in anticipation of lower yield until proven otherwise," Ross said.
This chart is ultimately signaling to Ross that at some point yields may rise again in the longer term, "but there's nothing in the short term that is telling you that yields have any urgency to go higher."
In the short to medium term, Max Wolff, market strategist at 55 Institutional, would agree with this point.
"The truth is that the fixed income market is making one economic forecast, and the equity market is making another," Wolff said Thursday on "Trading Nation," referring to bond yields falling while stocks continue to rise to new highs.
"But the equity market is making the same forecast it's made for nine years, across change in every single variable that it allegedly makes these forecasts on," Wolff said, adding that at this juncture "it's hard to bet against the fixed income space on the equities space in term of short- to intermediate-term macro forecast."
"If I'm asked to predict how you will do investing in the stock market for the next 10 years, I mean, it's probably positive. It's probably something better than the Treasury securities we have now," Shiller said.