A look at US 10-year yields
I have been watching the downward triangle in US year yields for awhile. The break in the trend coincided in the latest leg-up in USD/JPY.
What’s happening now is that the break is fading. Meanwhile, USD/JPY has flattened out.
It’s a minor dichotomy at the moment but I think it’s amplified because of recent economic data. The ADP revision and the strong ISM non-manufacturing report (along with the best new orders since 2005) haven’t moved the needle, which is troubling for the bulls in USD/JPY and those hoping for Treasury yields to move higher.
Technically, a downward triangle isn’t exactly the strongest technical signal to begin with. It’s starting to look like the trend is more of a sideways move in the 2.60%-2.80% range and that will be the track to watch.