10 year yield tests 100 day MA as the yield curve steepens.
The US yields are up in trading today with the yield curve steepening for a change. The comments from Trump and Fed's Bullard have helped.
Each are urging the Fed to slow down on the rate rises. That has helped the yield curve to steepen.
The yield curve has been flattening of late, on the expectations - at least to some like Bulllard and Trump - that the Fed would tighten into a recession. That elevated the shorter term yields and depressed the longer term yields.
If the Fed slows things down the hikes, the dynamics changes.
Below are the yield change today:
Looking at the 10 year, the yield is up 5.3 bps at 2.8913% currently. The high reached 2.895%.
Technically (see hourly chart below), the yield is up testing the high from yesterday. Moreover, the pair is close to breaking out of the range that has confined the yield since June 25th. The high yield on June 26th reached 2.8986%. A move above that level should lead to higher levels technically, with the 3.0% level a logical target on more momentum.
Taking a broader look at the daily chart, the yield is having trouble at the current level because it is testing the key 100 day MA (blue line in the chart below). That MA comes in at 2.8939%. The high today reached 2.895%. So traders seem to be leaning. Stay below and the bears remain in control.
However, if there is a break, that should solicit higher rates.
So we are at a key level and the market may wait until next week to sort the next move out. Today, those in the higher yield (and steeper curve) are winning. But they still have more work to do to kick yields higher.
