US: 10-year yields trading below its 20-day moving average since May 17 - BBH

US 10-year yields rose from 2.13% on June 6 and finished the last week around 2.22%, but the 10-year yield has been below its 20-day moving average (now ~2.23%) since May 17 notes the research team at BBH.

Key Quotes

“The Fed has hiked rates three times in the cycle so far, and each time bond yields have moved lower.  Both in December 2016 and March 2017, the 10-year yield had risen markedly and was near the upper end of a broad range when the Fed cut.  This time yields are at the lower end of a six-month range.  The September note futures posted an outside down day before the weekend.  The technical indicators favor follow through selling next week.  A break of 125-30 would strengthen the case of a top in price (low in yield).”