Details Cookies
Cookie policy

This website uses cookies to offer you a better browsing experience by enabling, optimising and analysing site operations, as well as to provide personalised ad content and allow you to connect to social media. By choosing “Accept all” you consent to the use of cookies and the related processing of personal data. Select “Manage consent” to manage your consent preferences. You can change your preferences or retract your consent at any time via the cookie policy page. Please view our cookie policy here and our privacy policy here

Technical Update - US 10-year Treasury yields, Euro Bund future and UK Gilt future Technical Update - US 10-year Treasury yields, Euro Bund future and UK Gilt future Technical Update - US 10-year Treasury yields, Euro Bund future and UK Gilt future

Technical Update - US 10-year Treasury yields, Euro Bund future and UK Gilt future

Bonds 4 minutes to read
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  Higher Euro yields after heavy selling in the Euro Bund future. Seems likely October lows will be taken out
UK Gilt future dropping hit by heavy selling after breakout of rising wedge pattern establishing new down trend
US 10-year Treasury yields found a floor at 3.41 bouncing higher. Likely to resume uptrend with the medium-term picture of higher yields around 4.75-5% still in play.

US 10-year T-Note future is breaking below support at 113 12/32. A daily close below the future is likely to trade lower. There has been divergence on RSI for a couple of weeks suggesting the upwards correction since October trough was coming to an end.
A sell-off down to strong support at around 112 seems likely. A close below there is no support until around October lows at 108 26/32.
To resume uptrend the T-Note future must close above 115 12/32

Source all charts and data: Saxo Group

After hovering around the 3.50% level for a couple of weeks the US 10-year Treasury yields seem to have found a strong floor at 3.41% now bouncing higher. If closing above minor resistance at 3.63 there is room up till resistance at around 3.90.

The medium-term picture of the US 10-year Treasury yields to reach 4.75-5.00 in Q1-Q2 2023 is still in play despite yields did drop below 3.50%.
Extract from analysis published 16th November:  Longer-term/going in to 2023: Within a few points US 10-year Treasury Yields reached 1.382 Projection of the 2019-2020 downtrend before retracing.
Monthly RSI is bullish and there is no divergence indicating we should expect new highs into 2023. US 10-year Treasury Yields has no strong resistance until around 5% which is also close to the 1.618 projection of the 2019-2020 correction.

Depending on the size of the current correction i.e., where it will bottom out, it could give energy for a move to 4.75-5.00%.  

For this bullish scenario to be demolished a close below 2.50 is needed.

Source: Bloomberg

The Euro Bund future has been dropping like a stone after breaking out of its rising wedge pattern. Fast approaching October lows around 134 the Future is currently trading at the 0.786 retracement of the Q4 correction where a minor bounce could be seen

RSI below 40 indicating lower levels are quite likely. If Euro Bund takes out the 134 level it could reach the 1.382 projection of the Q4 correction at 130.44. There is divergence on weekly RSI but if it drops below its rising trendline we are likely to see new lows. 
Close to the 1.382 projection level is the 0.786 Extension of the 3rd vawe down at around 130.66 i.e., what could look like the 5th vawe down would be 78.6% of 3rd vawe. See monthly chart

However, if closing below 134 there is no strong support for the Euro Bund future until 121. Strong support back from 2011. 
For Euro Bund to reverse this bearish picture a close above 143.38 is needed.

UK Gilt future broke bearish out of its rising wedge like pattern but have tried to get back in for a few days before being hit with heavy selling.
Gapping lower today Gilt is now back below its 55 daily SMA.
Strong support at around 99.92 where a minor bounce should be expected. However, RSI is below 40 with no divergence indicating Gilt could break the support at 99.92 and drop to 97.50 possibly 94.35 which are the 0.618 and 0.786 retracements respectively of the uptrend following the October trough. 
To reverse this bearish picture a close above 106.95 is needed.

RSI divergence explained: When the price of an instrument is making a new high/low but RSI values are not making new high/low at the same time. That is a sign of imbalance in the market and a weakening of the uptrend/downtrend. Divergence or imbalance in the market can go on for quite some time but not forever. It is an indication of an exhaustion of the trend



The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (
- Full disclaimer (
- Full disclaimer (

Boulevard Plaza, Tower 1, 30th floor, office 3002
Downtown, P.O. Box 33641 Dubai, UAE

Contact Saxo

Select region


Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.