Technical Analyst, Saxo Bank
US 2-year Treasury yield is testing May peak at 4.634. A close above is needed for extending the uptrend to 4.88-5%.
If yields slides back to close below 4.23 the trend has reversed.
US 10-year Treasury yield bounced off lower rising trendline. Uptrend is intact supported by positive RSI sentiment and all Moving Averages rising. However, a close above 3.86 is needed for the uptrend to be extended towards 4%.r .
1.618 Projection of the latest correction is at 4.05, same level as the Q1 high close.
To reverse this bullish scenario a drop back below 3.54 is needed. First indication of that scenario to play out could be a break of lower rising trendline.
2-year German Government yield is in an uptrend and could reach March peak around 3.38 within a few weeks.
To reverse this uptrend a close below 2.72 is needed. First indication of that scenario to play out would be if yields are breaking below its lower rising trendline
5-year German Government yield has formed an Ascending triangle like pattern it is trying to break bullish out of. A spike up today has been send back down below resistance at around 2.58. If closing above we could see a rally up to previous peak at around 2.90.
To reverse this uptrend a close below 2.32 is needed. First indication of that scenario to play out would be if yields are breaking below its lower rising trendline
10-year German Government yield has – similar to 2-years - formed an Ascending triangle like pattern. An attempt to break above the resistance at around 2.46 has at the time of writing failed.
A close above could fuel a rally to previous peak at around 2.77
To reverse this uptrend a close below 2.24 is needed. First indication of that scenario to play out would be if yields are breaking below its lower rising trendline
Bond. Long Bond(s)
With real rates being too positive, we see three scenarios: Opportunity to lock in rates at cycle high, government overreach to keep the economy afloat or a complete reset of the economy.
Steen Jakobsen,
Chief Investment Officer
Is a bond bull market ahead? Inflation still poses a risk for investors, but the moment for increasing duration to your portfolio may be approaching towards the end of the year, when central banks might be forced to cut interest rates.
Althea Spinozzi,
Senior Fixed Income Strategist
The furious rate hike cycle has brought gains in the US dollar, but with stagflation risks in Europe and the UK and weakness in the Chinese economy, USD may have more room to run. But a strong dollar could also have repercussions for US growth, emerging markets and commodity prices.
Charu Chanana,
Market Strategist
With the cost of capital rising painfully, stagflation fears are back, illuminating the fragile state of the green transformation, while giving a tailwind to nuclear power, and threatening the growth of AI-related stocks.
Peter Garnry,
Head of Equity Strategy
With supply tightness not only in energy but all commodities, the momentum in commodity prices may continue, pressuring central banks to lower real rates. That could be a good setup for precious metals, including gold, silver and potentially platinum as well.
Ole S. Hansen,
Head of Commodity Strategy
As the pandemic showed, even the US Treasury can experience seismic shifts. With the government increasing the pace of issuing bonds to support fiscal spending, the complex Treasury market and regulatory constraints could spark a liquidity event.
Redmond Wong,
Market Strategist
The tide has turned for bonds. Given the current yields, bonds have become an attractive investment, with added benefits including lower risk than stocks, increased diversification and a steady stream of income unaffected by economic changes.
Peter Siks,
Investment Coach