Ten Year Treasuries Going to 1.70%

Friday’s SPX move once again broke into Overbought territory by nearly 10 points, only to close below 1356.  Today’s Overbought / Oversold levels come in at 1352 and 1339, respectively.  We’ll be close to that 1339 level on the open given where futures are currently trading.  Treasuries are bid well this morning with the 10 Year Note currently yielding 1.786%.  Capital markets are caught in a little bit of a vortex here as the 10 Year Note is almost certainly going to 1.70%, and possibly through.  The 1.70% level was breached back in September.  Equities will have little room to run to the upside if Treasuries continue to move higher.  As a side note, the SPX closed at 1129 when Treasuries last touched 1.70%.

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