QQQ Lagged Correction Window

2020–2021

• Steepening, positive curve
  
• Liquidity + stimulus = QQQ ripped higher
  

2022
Flattening, then inversion

• QQQ corrected hard which matched the Fed’s aggressive hiking cycle
  

2023–2024

• Deep inversion, recovery in stocks
  
• Despite curve being negative, QQQ rallied
  
• That was “don’t fight the tape” (liquidity + AI boom decoupled equities from bonds)
  

2025

• Re-steepening
  
• Curve now climbing back toward +0.60%
  
• Historically, this “un-inversion” phase often lines up with late-cycle stress (Fed forced to cut, growth softens)
  
• Stocks can stay up for a while, but risk of a sharper equity correction rises when steepening = recession, not growth
  

A steepening curve can mean 2 very different things,

1. Bull steepener (2Y falling fast) = Fed cutting because growth is weakening which is bearish for QQQ medium-term
   
2. Bear steepener (10Y rising) = market pricing in inflation/deficits which hurts tech via valuation compression
   

Given where the Fed is in cycle, the risk leans more toward bull steepening = slowdown signal
QQQ is at highs while the curve is re-steepening from record inversion which usually sets up a lagged correction window for equities