NQ–2Y Correlation

This indicator tracks how NQ (Nasdaq futures) moves compared to the US 2-Year yield (US02Y). Most of the time, they go in opposite directions. This tool highlights when that relationship breaks down or moves too far from normal. This is an important fundamental indicator of overbought and oversold conditions in the market.

Features:

Stretch Measure (Z-Score): Shows when NQ is moving much more than you’d expect relative to the 2Y. Extreme readings (above the upper red band or below the lower blue band) often indicate overbought (red) or oversold (blue) conditions.

Correlation Tracking: Monitors whether NQ and 2Y are moving together or apart. Very useful to know when they are moving together, because one of those moves is false and represents an opportunity more often than not if combined with logical support or resistance.

Signal Dots: Green dots = both moving strongly in the same direction (rare). Red dots = strong move in opposite directions.


How I like to use it:

Watch the Z-Score bands (red/blue) for signs on the H1 or H4 that the move is really stretched. I use this for reversals in the direction of the trend.

Use the green/red dots to catch unusual synchronized or opposing moves between equities and yields.You can use this with your favourite equities that make up the nasdaq 100 too.