Credit Suisse is predicting that the yield on the US 10-year bond asset could hit 1.82% by the end of the year. A team of economists at the bank is predicting that the asset could be on the way to hitting the 50% retracement level from the 2019 move.
The bank expects the 1.43%/1.48% price level to continue to maintain support, thus keeping this outlook alive. However, Credit Suisse speaks of a double bottom base with a core 2021 objective at 1.82%, which seems to suggest that allowance is being made for a dip before a renewed upsurge that takes the US 10-year bond yield towards a projected price objective at 1.82%, following the break of a neckline.
This outlook leaves room for a period of consolidation, and some dips and potential surges, which could make for a choppy ride to the north as the year unfolds.
Technical Outlook for US 10-Year Bond Yield
The upsurge in the 10-year bond yield is a correction of the drop of 2019 to early 2020, with price having cleared the 38.2% Fibonacci retracement at 1.538 and now on course for the next target at 1.685, which is the previous low of 1 November and 3 December 2019 and the previous high of 7 February 2020. A clearance of this level allows the price to meet 1.856, which is a few points above the projected 2021 mark set by Credit Suisse. 1.95% marks the next upside target after this point.
On the flip side, rejection and pullback from 1.685 bring in a previous resistance-turned-support level at 1.538 into the picture. This point as well as the next downside target at 1.438 could be dip-buying areas that allow bulls to carry price towards the Dec 2021 targets. However, a drop below 1.438 could invalidate this outlook
and allow bond yields to drop towards 1.267.
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US-10 Year Bond Yield; Daily Chart
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