TNX (the yield on the 10 year, US Treasury note) fell 3.65% to close at 18.19 on the 30-dma last week. Look for a bounce with equities early this week but don’t expect it to be sustained as the daily Coppock is still high enough to expect a top, not a bottom. Resistance is near 20.00. Look for support at Friday’s close. A break of this level opens the door for a return to the April low near 17.00.
Longer term, TNX has closed below the lower trendline of the 3 ½ year triangle. If confirmed by a break of 16.65 (horizontal support), it forecasts a decline into negative interest rates for the 10yr note.
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