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US 10-Year Note Meets Our 127-12 Initial Downside Target

Posted on: Wednesday, May 6th, 2015

The CBOT 10-Year Treasury Note met our 127-12 initial downside target yesterday (May 5th), which was discussed in our April 29th report entitled Are US Treasury Prices Peaking?, to capture a 1% decline in the contract in one week.

During the same period the iShares 20+ Year Treasury Bond ETF (TLT) declined by 4.63 points or 3.6%.OK

From that report:

“This morning’s decline in the CBOT 10-Year Treasury Note indicates that at least a near term top is in place in long dated US Treasury prices at their recent highs, amid a similarly important bottom in long term US interest rates, and suggests that a test of the critical 2.21% area in benchmark US 10-Year yields is likely later this quarter.

This week’s rise in benchmark US interest rates, heading into this afternoon’s FOMC Meeting Announcement, suggests that the typically prescient and forward looking bond market may be starting to price in the inevitable first rate hike by the Federal Reserve.

US 10-Year Yields finished yesterday’s session at 2.19% from 2.00% on April 28th.

Asbury Research subscribers can view our latest research pertaining to US interest rates and Treasuries by logging into the Research Center and accessing the Intermediate Term Outlook: Global Asset Prices page.