TNX 10-Year Treasury Yield Daily Chart Fibonacci Retracements Downward-Sloping Channel Tight Bands Ready to Squeeze Out Big Move in Yield

The 10-year yield is calm as a cucumber as the stock market fluctuates wildly day after day. The 10-year yield has moved through the 2.30%-2.38% range for the last 19 days. It is difficult to count all the candlesticks within the sideways black channel since the chart has turned into spaghetti but it appears to be 19 sessions of sideways steadiness. That world of calm is about to get rocked. The tight pink standard deviation bands are squeezing in ready to create a sharp and quick move in the TNX. The tight bands do not predict direction only that a sharp fast move will occur.

After yield recovered off the uber low intraday in mid-October, it blew up through the 32%, 50% and 62% Fib retracements for the move down during September-October. As soon as yield pushed through the 62% Fib at 2.34% it got slapped down by the 50-day MA at 2.37%. Then yield was stunned and started to stagger sideways along the 62% Fib and is currently deciding which way to pivot. And the next move will be big as the tight bands indicate. The 200-week MA is 2.34%.

The MACD lines are about to cross negatively, if so, the bond bulls win (lower yields higher prices) and TNX will start dropping in earnest. If you want higher Treasury yields you do not want that negative MACD cross to occur. The short red lines show indicators leaking lower which gives lower yields an edge. Also, the RSI and stochastics are under the 50% level, and ROC under zero; all bearish for yields (bullish for note and bond prices). Note the MACD is on top of the zero line so that is another indicator to watch in addition to the cross. If MACD drops under the zero line then yields are dropping.

The direction is a difficult call although you can give the advantage to lower yields (bond bulls with higher prices and lower yields). The two standard deviation limits and the two black channel lines, in addition to the MACD cross and zero line, provide the tools to confirm who wins with the big yield move. If yield moves higher above 2.38%-2.39%, bingo, yields are going to launch higher. If yield drops under 2.30%, there is trouble afloat for yields, and if the 2.28% fails, boom, it's ovah, and yields will start dropping in earnest. The tight bands tells you the big move is at hand.

The 10-year is 2.31% as this article is typed on Sunday evening US East Coast time. After nearly one-month of sideways boredom, the 10-year yield is going to receive a lot of attention over the next couple weeks with a big move. Yields should leak lower but watch the limits described above and the MACD cross to confirm the direction of the sharp move that is at the doorstep. Overall its a coin flip but the 2.38%-2.39% on the top side and 2.28%-2.30% on the bottom side will tell you the winner and the violation of one of these should occur this week. The long wait is over. It is decision time. 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.