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Thursday, March 28, 2024

Yields Continue to Rise

Courtesy of Doug Short.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.


Now is an excellent time to review the yield charts for the US 10yr Note and the US 30yr Treasury Bond. This year’s Fed taper-talk came at a time when many investors were simultaneously concerned about future inflationary prospects, and yields have consequently jumped as a result of an exodus from longer dated bonds. Let’s examine the charts in order to gain a technical perspective of this rising yield environment.

The first chart is the yield chart for the US 10yr Note. Notice the downward secular trend in yields that is defined by the well-established bearish trend channel. The chart also shows the breaching of the initial resistance area of 2.4%, which is shown as the lower red horizontal line. More significant resistance lies in wait at the upper red line, which is the 3.25% area; and final major resistance is represented by the upper channel line, which comes in just under 4% at the current market trajectory.

 

 

The next chart is the yield chart for the US 30yr Treasury Bond. A similar long running bearish trend channel is in place. Yields are pressing upward in an apparent attempt to test the 4% resistance area, and the upper channel line of major resistance.

 

 

In conclusion, these charts appear very straightforward in their technical implications. Yields are rising and will test resistance levels. If resistance levels hold, then perhaps we must continue to wait for the long anticipated next bear market for bonds. On the other hand, if yields blast out of these bearish secular trend channels, then perhaps the bond bubble prognosticators will be vindicated, even if they were a bit early. The one definitive is that technical parameters are very clearly defined.

Dominic Cimino
Chief Investment Strategist
Financial Advisor
Preferred Planning Concepts, LLC
2800 South River Road #240
Des Plaines, IL 60018

Registered Representative, Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Preferred planning concepts, LLC & Cambridge are not affiliated.


? 2013, Dominic Cimino of Preferred Planning Concepts, LLC (You can explore the services offered by Preferred Planning Concepts by viewing us on our website at www.ppcplanning.com) Any redistribution, reprinting, or reference to this chart or content is allowed so long as reference to the author and source is acknowledged.

Important Disclosures

Please be aware that this is not a recommendation to purchase or sell any security. This is not a recommendation for any individual or institution to alter their portfolio holdings. Every individual or institution has its own risk tolerance and investment objectives and perspectives.

Any above opinions of the author should be viewed as such. These opinions in no way represent any type of guarantee. Realize that if you choose to invest in securities, investing in securities carries with it uncertainty and the risk of loss of principal. Lost investment opportunity is also a possibility. Investing in securities carries no guarantees.

Past performance is no guarantee of future results. The price movements within capital markets cannot be guaranteed and always remain uncertain. The above opinions are meant to stimulate thought and should be viewed as such. You are encouraged to discuss these views with your representatives if you have any questions or concerns.

Any indices mentioned are unmanaged and cannot be invested in directly.

It must here be mentioned that technical analysis offers no guarantees of future price movements. Technical analysis represents an observation of past performance and trend, and past performance and trend are no guarantee of future performance, price or trend. The price movements within capital markets cannot be guaranteed and always remain uncertain.

Neither Cambridge Investment Research nor Preferred Planning Concepts is responsible for the accuracy of content provided by third parties. All material presented herein is believed to be reliable but we cannot attest to its accuracy.

All charts presented were made available by eSignal, a charting service available to individuals or professionals. Anyone interested in exploring the potentials of eSignal should give us a call.

 

 

 

 

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