TNX 10-Year Treasury Note Yield Weekly Chart; Negative Divergence Developing; Upper Band Violation; Doji Candlestick

The TNX weekly chart prints a doji last week which typically hints that a trend change is on the table. The yield has printed above the upper standard deviation band for two weeks and desperately needs to back kiss the middle band, which is also the 20 MA, at 2.46% and rising.

Yield makes a higher high with the RSI and stochastics going negge d. The MACD line remains long and strong, however, wnating another higher high in this weekly time frame after a pullback.

Note that over the last year, the yield is higher but the indicators are negatively diverged. This tells you that over the intermediate and long term do not get excited about rates rising rapidly. The chart indicates more of a choppy sideways move for the months ahead.

The gray lines show the two-leg bull flag pattern that played out. Leg one is from 2.03% to 2.48% a 45 bip pop. Then textbook consolidation sideways with a slightly lower bias, then the second leg begins at 2.30% which targets 2.75% which was achieved. 

The weekly chart wants the yield to relax back to the 2.70% to 2.75% range in the days ahead, or week or two. The MACD line in the weekly above, however, will want to send the yield higher which will likely take out the 2.87%-2.89% resistance but any further upside in yield should be somewhat limited.

The 10-year may top out in the 2.87%-3.00% on this weekly chart then chop sideways for many months through 2.50%-2.90%. Things can change quickly. The CPI data drops on Wednesday and this inflation data may be the most important event of the week. Yields will immediately react at 8:30 AM EST Wednesday morning. The PPI drops on Thursday morning. 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.