This post updates our Jan 27, 2015 Update on Bonds:
This morning’s unemployment report has sent yields soaring. The reasoning is that stronger employment will cause a stronger/earlier rise in interest rates than the Fed would otherwise have planned.
From a chart standpoint, the 10-year yield is very overbought. In other words, we’d be aggressive buyers of notes here at 1.95% (128’150) with stops at 127’185.
Note that TNX has again tagged the underside of the rising red channel channel…
Because a channel bottom backtest is involved, the stops are pretty obvious. A strong move north of this morning’s highs (19.53) would be cause for reassessment.