Recent decline in US 10-year yield resumes today and hits as low as 2.264 so far, breaking even 2.27 handle. Though, much like the fall in German yield earlier today, the move is not much reflected in the forex markets yet. Dollar remains steady for now, even against Yen. Indeed, USD/CHF is extending this week’s recovery from 1.0008 and is heading back towards 1.0119 resistance.
We’ll continue to keep an eye on the developments of 10-year yield. For now, based on currently momentum, we’d expect further decline to 61.8% retracement of 1.336 to 3.248 at 2.066, which is close to 2.034 support as well as 2.0 psychological level. Strong support could only be seen around that level to bring sustainable rebound.
