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17 Mar 2015
Treasuries continue to rally – RBS
FXStreet (Barcelona) - John Briggs, Head of Cross Asset Strategy at RBS, gives the technical outlook for US 2yr, 5yr, 10yr and 30yr treasury yields, noting that the bullish momentum continues.
Key Quotes
“Treasuries continue to rally into the Fed meeting, frustrating the rate bears whose view was that the NFP report would solidify the case for the Fed to remove "patient." As has been the case for some time now, the argument was better expressed and won in the currency realm rather than the rate realm, where policy divergence is a support for the US leg, not a detractor (meaning ECB easing = lower EU yields = an anchor for US rates on differentials).”
“2s (0.658%)- Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.40% where we'd close a gap left behind in late October. Daily momentum is bullish.”
“5s (1.577%)- Next major support comes in at 1.80% and just above. Next resistance begins at ~1.30% and extends down to major resistance at 1.15%. Daily momentum is bullish and showing evidence of bullish divergence.”
“10s (2.095%)-Next resistance comes in at ~1.96%, the Feb 12th lows that we recently rebounded off of. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is bullish and showing bullish divergence.”
“30s (2.67%)- Bonds don't have any solid support until 3.105%, the November "lows." Local resistance is ~2.54% and after that we should hit some headwinds around 2.40%. Daily momentum is bullish and showing strong evidence of developing bullish divergence.”
Key Quotes
“Treasuries continue to rally into the Fed meeting, frustrating the rate bears whose view was that the NFP report would solidify the case for the Fed to remove "patient." As has been the case for some time now, the argument was better expressed and won in the currency realm rather than the rate realm, where policy divergence is a support for the US leg, not a detractor (meaning ECB easing = lower EU yields = an anchor for US rates on differentials).”
“2s (0.658%)- Next major support doesn't emerge until ~0.80% where we found buyers back in the spring of 2011. Resistance seen at 0.40% where we'd close a gap left behind in late October. Daily momentum is bullish.”
“5s (1.577%)- Next major support comes in at 1.80% and just above. Next resistance begins at ~1.30% and extends down to major resistance at 1.15%. Daily momentum is bullish and showing evidence of bullish divergence.”
“10s (2.095%)-Next resistance comes in at ~1.96%, the Feb 12th lows that we recently rebounded off of. Next support comes in ~2.40% with major support at 2.66% after that. Daily momentum is bullish and showing bullish divergence.”
“30s (2.67%)- Bonds don't have any solid support until 3.105%, the November "lows." Local resistance is ~2.54% and after that we should hit some headwinds around 2.40%. Daily momentum is bullish and showing strong evidence of developing bullish divergence.”