10-Year Treasury Yield Forecast: The Next Levels I’m Watching

The 10-year Treasury yield is on the move. Whether you trade bonds directly or other securities like stocks, you need to be aware because we’re in a new environment. We got our first Fed rate hike in three years last Wednesday, and more are expected through year-end. Here’s what I see ahead.

The 10-Year Is Back Above 5%

Here we have the daily chart of $TNX.X. This takes the 10-year Treasury yield and multiplies it by 10. So when you look at the current price action on the hard right edge of the chart, you can see the intra-month action trading above the 5.10% level because on this chart, that shows up at 51.60.

The 10-year closed back above the all-important 5.00% level on Wednesday, September 23rd. It had been dabbling around that area for more than a week.

But now, the upside party has begun. There are two levels I think are important to monitor over the weeks ahead.

The first is 52.10, which corresponds to a 5.21% yield.

That level is based on a forecast, and my expectation is for $TNX.X to trade up to 52.10 by October 1st.

That date is a guideline. It’s never a guarantee.

Beyond that, I also have 53.16 marked as another level to keep an eye on. That’s the high from the Aug 2007 subprime credit crisis start.

Mapping the Fed Alongside Price

All of this is within the context of what I’ve been mapping on this chart.

Each yellow vertical line represents a Fed meeting announcement. The one farthest to the right in September coincides with the rate hike, while the two before that coincide with meetings where there was no change to rates but we got hawkish comments from Fed Chair Warsh.

I also marked the beginning of Warsh’s tenure with the blue vertical line back on May 22nd.

I go more in depth into how to map a market in my newly updated Gann Trading Patterns System, but I wanted to show you here how I’ve mapped some of this fundamental data right alongside the price action.

In the meantime, I wouldn’t be surprised if we continue climbing above 5.00% on the 10-year. The pace at which that unfolds, along with the pauses and consolidations that happen along the way, are going to be important factors when we tie this back to broader stock market performance.

So keep an eye on the 10-year, no matter what you trade.

📺PS — I Share Videos Too!

I’ve been writing a lot of text blogs lately, sometimes with chart analysis like this, because well…braces. I’m 6 months in, 14 to go. 😁

But I share videos too! You can catch my short educational clips on all the major social media channels starting with YouTube:

https://www.youtube.com/@himareddycmt/shorts

Got an idea for a video you’d like me to make? 

Comment below, I’d love to hear it.