There is further upside in the short-term for US yields, but the longer-term downtrend remains, according to Andy Dodd, Head of Technical Research at Louis Capital Markets.
Dodd notes that after breaking above key resistance at 0.9555, the rally in US 10 year yields has the potential to go further until it reaches resistance from the long-term downtrend and, above that, key resistance at 1.379 (Chart 1).
In the meantime, following the breakout in US 10-year yields, many Bank and Insurance equities, for example Aegon (Chart 2), are reaching 3-month or more highs after having completed bullish breakouts.
