Higher USD and lower Commodity prices and some bad economic news from
and US , help investors to go under the shelter of US Treasuries . Germany
Germany is suggesting about rescheduling of debt for
demand for government bond increases as yields decreases . Japan
2-year Treasury yield is getting support at 0.55 range , it has formed a bearish pattern . 5-year Treasury is looking for support around 1.8 level .10-year treasury has a good support at around 3.10 level .
During last 18 days yields for 10-year Treasury was down for 15 days , and it is down for straight 7 days . Things needed to be watched whether it breaks the 3.1 level . As I was talking during last few weeks that 30-year Treasury yield has formed a bearish pattern , this week it’s move proves the pattern as it gave lowest figure since December . But it’s move in the last day was quite interesting , as it decouples from others . Though it can go up to 4.1 level in the down side and if things worse then it can even touch 3.9 level .
Treasury will sell $72 billion in coming week .
Everyone is waiting to see how US raises it’s $14.29 trillion debt limit in May 16, 2011 . If they don’t increase it by May 16, 2011 then they have to find other sources may be delaying payments in other areas . If they do not able to raise the limit then there is a chance of default and which can create another financial crisis .
So in this circumstances if market smell any type of uncertainties, Treasury prices will jump .
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