Today's edition of the Saxo Morning Call features the SaxoStrats team discussing the continuing weakness of the US dollar as commodity prices recover ground and in the wake of key US equity indices hitting all-time highs Thursday.
Article / 20 November 2017 at 9:22 GMT

Make or break for US 10-year T-note

Technical Analyst / Saxo Bank
  • Pattern confirmation in US 10-yr chart may be just a few days away
  • Support at around 124 doesn't appear to be very strong
  • Resistance at 55-day SMA would be difficult to overcome

By Kim Cramer Larsson

The US 10-year T-note could be forming an inverted Shoulder-Head-Shoulder pattern on the daily chart. Confirmation could be only a couple of days away. Will it trade higher, breaking the falling trend line which would then be the neckline of the pattern OR drop below last week's low at 124 16/32?

If the latter scenario plays out we will see a retest of the October low and support at around 124. That support doesn't seem to be very strong and a further decline towards 122 20/32 could be on the cards.

However, if the future breaks above the falling trend line, an inverted SHS pattern could very well unfold. A big test after a break of the trend line would be at around 125 15/32. The 55-day simple moving average would act as resistance that could prove hard to overcome. 

If the SHS pattern unfolds a move to 126 level should be seen as minimum target. 

Source: Saxo Bank

– Edited by Clare MacCarthy


Kim Cramer Larsson is a technical analyst at Saxo Bank 


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