The talking heads continue to say that yields on the 10-year U.S. Treasury note cannot and will not trade above the 2.60 percent level. It should be noted that the 2.60 level has been resistance since December 2016. The support level on the yield chart since that time has been 2.30 percent. Currently, the 10-year U.S. Treasury yield is hovering around 2.37 percent. Many traders and investors are thinking that yields are going to fall further, but that's just long-term consolidation. The high range of the chart's consolidation range is 2.60 percent and the low end is 2.30 percent..
If traders look at a monthly yield chart, they will see a nice tight consolidation pattern. Should this pattern on the monthly chart play out as expected it signals a move in the 10-year U.S. Treasury Note yield to around 2.82% and possibly higher. The same pattern is also forming on the 30-year U.S. Treasury note yield. This monthly chart pattern signals a move to 3.43 percent and possibly more. The bottom line is that yields are poised to move higher very soon.
There are a few ways to play bond yields as a stock trader. One way to trade the 10-year U.S. Treasury yield is to play the ProShares UltraShort 7-10 Year Treasury (NYSE:PST). This ETF tracks the yield chart on the 10-Year Treasury. If traders are looking to trade the 30-year T-bill yield they can play the ProShares UltraShort 20+ Year Treasury (NYSE:TBT).
