Fixed Income
Clearly the most interesting chart out there right now is the US 30-year yield.
On 29th May the US 30-year yield hit and held the 76.4% pullback of the prior move around 4.75% which turned out to be a pivot point for the next move lower in yields into 14 June with a sharp fall in the following 5 trading days.
The subsequent bounce into yesterday's high just over 4.65% was again a perfect 76.4% pullback of that fall at which it stopped and subsequently moved lower from.
Double 76.4 or more (topside) to come?
The coming days will tell but for now this bounce in yields has peaked in exactly the same way as it did in May
In May when this happened, we also saw 76.4% pullbacks on 2's, 5's and 10's. This time around it was only on 30's (so far) leading to the break talked about yesterday on the 2's 30's curve, that is still intact and targets minus 6 to minus 8 bp's
Also worth noting that on the German 10-year yield yesterday's high was 2.615% and the 76.4 level is 2.619%
Commodities
WTI has reached its $83.85-$84.09 objective (Horizontal resistance and 76.4% pullback of last fall)> There is some momentum divergence but not yet enough to signal a potential top. A close above this range, IF seen, would suggest the danger of a return to the trend highs at $87.67 with interim resistance at $84.46 and $86.28.
Above there the 76.4% pullback of the $95.03-$67.71 fall comes in at $88.58.
In addition, there is a danger that this could be viewed as an inverted head and shoulders with an upward sloping neckline and a target close to $92.
Above there the only level left is the Sept 2023 high at $95.03
European Nat Gas posted its second bearish outside day in 4 days yesterday suggesting a re-test of supports at
EUR 32.3
FX
USDBRL has broken out of what is looking like a double bottom within a triangle that suggests a danger of new highs around 6.35.
After previous breaks the ultimate moves have been greater and have traded to the upward sloping line presently standing at 8.
USDCNH posted a bullish outside day yesterday and is higher again today. A move to test the 7.3680-7.3750 range still looks likely. This as the China 2-year yield hit another new trend low at 1.643%
Equities
Nikkei completed a bullish outside day overnight as it seems to be benefiting now from the renewed JPY weakness. It closed above the 76.4% pullback level at 40,060 suggesting we may see a return to the highs at 41,088
