Halister News

(Bloomberg) -- As oil remains a key pacesetter for global mkts and risk sentiment, WTI crude’s turn lower against its 3-mo. trendline may spark a new bout of strength in long-end USTs and a fresh downturn in U.S. breakeven rates, Bloomberg Technical Analyst Sejul Gokal writes.

• Click here for WTI chart vs 10Y UST yield, breakeven rate
• Oil falters at resistance as counter-trend rally abates:
  • WTI (generic) fails yday against the Nov. down-trendline at $31.28 today; lvl also near $31.82 hurdle, the 76.4% Fibo of early Feb. downdraft (see chart)
  • Brent (generic) rejecting 55-DMA and horizontal resistance line at $34.62/$35.98 (see chart)
• UST 10Y yield down 55bps YTD at 1.72%, may re-test 1.53% intraday low seen Feb. 11 after unwinding overbought conditions
  • Larger support at 1.38%, the 2012 low
  • 30d correlation to WTI at +0.59; to Brent at +0.55
• U.S 10Y breakeven rate forms an outside day lower against 21-DMA at 1.31%; may re-test 1.12% intraday low seen Feb. 11 (see chart)
  • 30d correlation to WTI at +0.69; to Brent at +0.60

• NOTE: Sejul Gokal is a technical strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.