US 10-year yield rises to 7-year high, what's next?

The US 10-year treasury yield rose to a 7-year high of 3.095 percent.
The yield could rise to 3.5 percent this year, the technical charts indicate.

Omkar Godbole FXStreet Contributor

The yield on the benchmark 10-year treasury note finally cut through the resistance at 3.04 percent and rose to 3.095 percent yesterday - the highest level since 2011 and the technical charts indicate the party has just begun.

The bull flag breakout, a bullish continuation pattern, confirmed in mid-April (seen in daily chart) indicates scope for a rally to 3.5 percent.

The bullish setup in the daily chart only adds credence to the long-run bearish-to-bullish trend change, as highlighted by the inverse head-and-shoulders breakout on the weekly chart.

Clearly, the 10-year yield looks set to rise in the USD-positive manner in the near future. As of writing, the yield is trading at 3.07 percent.

Daily chart

Weekly chart

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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