HALISTER1: UST MORNING CALL: ‘10Y Rally Is Getting Toppy’

UST MORNING CALL: ‘10Y Rally Is Getting Toppy’

(Bloomberg) -- “The 30bp+ decline in the US 10Y yield since mid-March is ripe for correction,” independent strategist Marty Mitchell says in note.
  • “We do not discount the chance that it might make marginally new lows (yield basis) that could take it through Thursday’s 1.683% yield low to test key resistance from February at 1.645%, but the 10Y rally is getting toppy and the longer-term momentum studies are starting to turn from overbought extremes”
  • Other observations from strategist morning notes:
  • BMO (Aaron Kohli): There is “no real news flow to explain a lot of this move other than slight beat in Japanese consumer confidence and a warning by Japan’s Finance Minister Aso that intervention would be forthcoming if required”
  • CRT (David Ader): “We’re taking the cautiously bearish approach, booking profits against overbought momentum and various technical objectives having been met. Much of that, too, is about more important data next week than we’ve seen this week and the simplicity of some duration being added with the auctions”
  • Seaport Global (Tom di Galoma): “Still favor buying dips on weakness as Fed decides to stay on hold in 2016 longer than the market believes”
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Aaron Kohli (Bank of Montreal)
David Ader (CRT Capital Group LLC)
Marty Mitchell (The Mitchell Market Report LLC)
Tom Di Galoma (Seaport Group LLC/The)

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