In most cases, yields will tend to trend lower in the early stages of the Fed's rate cutting cycle. But this isn't like those cases, at least for the time being. There is something driving yields back higher and that is catching the market attention again since the start of the month. Is it the economy? Is it inflation? Is it the election?
As mentioned earlier, I'm sympathetic to the final point but it could also be a mix of reasons: Rising bond yields erode the risk trade, but what's driving it?
In any case, the technicals are also starting to intrigue now. 10-year Treasury yields are passing a crucial point, nudging above its 200-day moving average (blue line). It's the first time since early July that yields are holding both above that and the 100-day moving average (red line).
The next few weeks will be interesting to watch to see if this is really just all about the election. Or perhaps there is some other underlying driver that is getting traders worked up.