TNX 10-Year Treasury Note Weekly Chart Inverted H&S Channels

The 10-year yield will play a key role in tomorrow's action. The TNX sits at 1.90%. If yields move higher, the equity (stocks) bulls will rejoice. If the TNX drops through 1.90% and heads lower, the market bears will be happy as honey. One side or the other will win.  The long-term weekly chart shows the yield drifting ever lower over the last five years. The neon green positive divergence identified the launch pad last summer. The brown inverted H&S shows a target of 3.10% above, however, do not hold your breath. Keystone continues to look for extended disinflation and deflation for at least a year or two more, so the TNX may move sideways for many more months frustrating the inflationists.

The red lines show the negative divergence that has created the smack down in yields over the last few days. The 20-week MA is 1.83% which will likely be a key test in the days ahead.  The 20 MA is above the 50 MA which is bullish for TNX bolstering the higher yield case.  If yield falls through 1.83%, however, the 20 MA will curl downward. The purple channel is an interesting path forward for yields; sideways with a downward bias. The 200-week MA continues to slope downwards which is very negative for yields. TNX displays a cyclical nature shown by the red and green dots, the ebb and flow of the markets. The red dot shows that now is a logical place for yields to top and move lower again. Projection is sideways to sideways lower yields moving forward. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.