The spread between the 5- and 30-year US Treasury bond yields (UST 5s30s) has broken above two key levels, according to Sejul Gokal, Chief Technical Strategist at GO-TechniKAL Insight.

Looking at a Chart of UST 5s30s, Gokal points out it has cleared two important levels – the 40bps level, previously an area which has attracted flattening interest, and its 200-day moving average. He thinks the next target will be 45bps and then 47bps, as the curve continues to steepen.

See Chart.