TNX 10-Year Treasury Note Yield Weekly and Daily Charts

The 10-year yield jumps from 1.62% to 1.85%, 13 basis points, in only six days.  The falling wedge on the daily chart, along with oversold conditions and positive divergence, created the launch. The red H&S pattern targeted 1.61% which was the near-term bottom. The gap fill at 1.61%-1.62% also acted as a magnet for price. The daily chart indicators are long and strong indicating higher highs in yield after a pull back occurs although the stochastics are negatively diverged indicating the initial pull back is on tap. The 50-day MA is 1.82% so that is a big deal for the TNX to pop above this key S/R level. The gap at 1.90% serves as an upside target and then perhaps the sideways to sideways lower action will resume.

The weekly chart shows the moving averages flattening indicating that sideways yields may be in store for months, and years, forward. The sideways channel through 1.58%-2.10% is in play.  Also, a ceiling is created by the 20-week MA at 1.864% and floor at the 50-week MA at 1.736% so watch for the move in yield out of this range since it will then lead to the move to one of the outer yellow rails.  Yield is coming up to test the 20-week MA resistance today. Anyone hoping for inflation, and expecting it to appear around the corner, like Godot, wants the red inverted H&S pattern to play out. The head at 1.40% and neckline at 2.30% targets 3.20% once the 2.30% is breached to the upside. Projection is for yield to top out in the coming days in the 1.86%-1.92% area, then back down to reenter the longer term sideways move going forward. Sideways yield action is expected for many months 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.

Note Added 10:26 AM:  Chairman Bernanke just finished a morning talk and Q&A session. Bernanke voices concern over the 'chase-for-yield' drama ongoing in markets. Perhaps he realizes, or is at least hinting, that he wants to be supportive but it is questionable how much good is being done, or, more importantly, how much damage is occurring to markets as a result of the Fed actions. The 10-year yield jumps from 1.85% to 1.88% as a result of Bernanke's words slicing up through the 20-week MA at 1.86%, as described above, like a hot knife through butter.

Note Added 10:55 AM:  1.89%.

Note Added 11:20 AM:  1.90%.

Note Added 11:35 AM:  1.91%.

Note Added 11:45 AM:  1.92%.

Note Added 12:00 PM:  1.91%.

Note Added 12:22 PM:  1.90%.