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23 Feb 2015
US 10-year treasuries likely to re-test 1.78% - RBS
FXStreet (Barcelona) - Dmytro Bondar, Technical Analyst at RBS, gives the technical outlook for US 10-year treasuries, expecting a re-test of 1.78% on a break of the resistance at 2.00%.
Key Quotes
“The market has formed a base in yields in the area of 1.61% - 1.78%, as we expected. This area marks the sell region of an inverted Head and Shoulders pattern formed on the yield chart during 2011- 2013.”
“The market has now reached the yield trendline, indicating a high probability of a near-term reaction – implying a sideways theme with a possible re-testing of 1.78% should 2.00% resistance be broken.”
“Therefore, I favour covering shorts for now and being neutral for the time being, looking to establish new shorts against the 1.78% resistance.”
“Caveat would be a sustained break below 1.61%”
Key Quotes
“The market has formed a base in yields in the area of 1.61% - 1.78%, as we expected. This area marks the sell region of an inverted Head and Shoulders pattern formed on the yield chart during 2011- 2013.”
“The market has now reached the yield trendline, indicating a high probability of a near-term reaction – implying a sideways theme with a possible re-testing of 1.78% should 2.00% resistance be broken.”
“Therefore, I favour covering shorts for now and being neutral for the time being, looking to establish new shorts against the 1.78% resistance.”
“Caveat would be a sustained break below 1.61%”