Treasury Yields Likely to Rise

Today's payroll report puts the Treasuries in a precarious technical position. While I still think a real blowout in yields is highly unlikely, based on my read of the technicals, in the short term, Treasury yields look likely to rise. Here are some of my observations, targets and ways to play it.

The recent 10-year Treasury closing high (in yield) was 2.03%, which it hit twice in mid-February. Post payrolls, it is trading between 2.04% and 2.08%. If it can close above 2.03%, then I think the bears will be in control. But this isn't the only bearish indicator we've got here. Futures on the 10-year Treasuries have crossed below the 50-day SMA with today's move lower (measured in price). Indeed, whatever reasonable SMA you want, it is below it. The 200-day SMA is still sloped upward, but all the shorter-term ones are sloped lower. It would be doubly bearish if the futures contract could close below $130....440 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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