Move to higher yields resumes
The US 10 year yield spiked higher last week to the highest level since February 2020 at 1.6085%. The yield them corrected lower to retest the 38.2% of the move up from the January 28 low at 1.3738% (the low yield reached 1.3776% and bounced). That was key. The correction lower was just a plain vanilla variety.
After a modest rise to 1.4580%, a move to retest the 200 hour MA (green line) saw the yield bounce ahead of the key MA line yesterday. The combination of the bounce off the 38.2% and then the rising 200 hour MA, gives the higher yields argument more credibility.
IN trading today, the yield has moved back above the 100 hour MA at 1.4410% and is seeing more upside momentum (taking the level above the Monday high). The high today reached 1.4956% just ahead of the 1.50% level. The current level is at 1.480%. up 8.8 basis points on the day.
It will take a move back below the 100 hour MA at 1.4410% to ruin the higher yield bias. If that does not happen a run back above the 1.500% level will open the door for a retest of last week's high at 1.6085%.
