US 10-year yields to close the week above 2.40%
For me, the 10-year yield is the most important metric in the markets. It touches on everything and touch everything.
It is also the most powerful signal and that includes techniques. Earlier this year, the failure of 2.40% to predict a dip in the US dollar from July until early September. Prior to this, the failure of 2.65% is also preceded by a dollar slide.
Now, things are moving in the other direction, with yields above 2.40%. This is a level of Bill Gross recently said would indicate the end of the generation bull market in bonds.
A part of the story is exciting Taylor as chairman of the Fed, but even on the reports that Powell is in the head, 10s took place at the top of the key. And it seems that it will be a weekly close above too.
That said, you want to see a bit of a break before declaring it broken. With the Fed’s decision, the chairman of the Fed decision and non-farm employment in the coming week, I don’t think this is going to be a long wait.