Technical Update - US 10-year Treasury yields hovering around 3%. Needs direction. Euro Bund future in uptrend. For now
Kim Cramer Larsson
Technical Analyst, Saxo Bank
US 10-year Treasury yields bounced from just above the key support at 2.71 now hovering around the 3% level. To get upside traction yields must break above 3.12%. If that occurs, we should expect June peak at 3.5% to be tested and most likely to be taken out.
Is yields moving in a falling channel formation? It does look like it. We might see a real test of key support at 2.71% before yields resume its uptrend. For now, we are in a bit of a limbo.
The US 10-year Treasury Note future is hovering around 118 16/32 level in a (for now) short-term rising channel. 121 is the key resistance.
A daily close below 117 18/32 and bear trend resumes.
The Euro Bund future (10-year Euro yield) is nearing key resistance at around 156. RSI is above 60 showing positive sentiment indicating further upside i.e. lower Euro yields.
If the Euro Bund breaks below the lower rising trend line and closes below 149.75 uptrend has reversed and we are likely to see Bund future to move to support at around 1144.72 and June lows.
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