Bund Yields back at the 13bp Juncture
Bund Yields have not managed in recent weeks to close above the 29.4 bp mark and have now drifted lower after breaking an inside week to the 13.4bp area which has acted as support (price resistance). If we can finally close below this area, the market could open up to the upside in price which will likely mean a test of the all-time low yield at 4.9bp.
Tnote Yields Consolidating Around Previous Pivot of 1.9%
The Tnote yield chart has been consolidating in recent weeks around the key pivot of 1.9% which was a very key support back in August and October 2015. Where we settle after a break of the triangular pattern will give us the clue as to where it wishes to auction. To the upside key yield level to reckon with is the 2% area and below at 1.8%.
2s30s Yield Spread Continues to Flatten
After a very short lived pullback in the flattening theme after the dovish FOMC, the 2s30s yield spread has continued on its trajectory to the downside with it having broken only slightly the key cycle lows at 1.786%. If we get a close below this level this could mark the beginning of a much more aggressive flattener that we usually see in Fed hiking cycles.
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