Breakout Of the 40 Years Old DowntrendUS 10 year bond rates are important indicator for investors.
If its go up, it means investors are selling their bonds expecting interest rate rise from FED.
This is happening for over 1.5 year now.
Investors are selling bonds because they think inflation coming and FED will act accordingly.
High interest rates cause risky assets, like crypto and stock market, to lose value.
In this Monthly chart,
Something huge is happening with the 10 years right now.
We were in a downtrend that started in 1981.
We tested the trendline in 1984, 2007, 2018 but never able to break it out.
Last months, breakout occured and we may retest the trendline before going up.
Around 3.25 area seems to have a strong resistance.
Also around 3.25 area, investors may want to buy bonds therefore 10y rates can pause their rise for a couple of months.
The breakout of this decades long trendline may mean that, we entered a new period of high interest rates.
But in the end everything will be decided by FEDs actions.
Thanks.
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