It looked like the bond market rout was going to extend at some point yesterday but the bulls are putting up quite a bit of fight at the first key test. 10-year Treasury yields hit 4.30%, which is a critical juncture on the charts, and so far that level is holding.
In the context of the rise in yields since last week, this isn't much but it is already undoing the moves higher on Wednesday and Thursday this week.
It is but the first test of the 4.30% mark, so I'd caution against early thinking that this is where the bond market turns around.
Economic concerns continue to linger, especially from China, but bond traders have braved past that for many days already now. I can't quite see how all of a sudden it becomes the main issue for a turnaround in sentiment. Not least when there is still plenty of talk about the waves of supply in Treasuries, which quietly might be the driving factor behind the move higher in yields since last month.
In any case, this continues to be the place to watch as we approach the end of the week. So far, it hasn't quite have much reverberations to broader markets though. The dollar is mostly steadier and keeping mixed/little changed while equities are still slumping regardless, with US futures down on the day and pinning European indices lower as well.
