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Bond of the Week: 11 February 2016
Top-heavy picture for US 5yr Yield

The US 5-year Bond Yield has extended the somewhat overstretched decline from the December high near 1.8% this week. The latest fall has resulted in a break out of the multi-year trading band into the smaller base area. That region stretches down to 2012 support around 0.6%.

US - The 2-year Treasury Note future cleared the October ceiling to rally to a new contract high during the week. This is in spite of an overbought RSI indicator. Some resistance is noted at the new high, 109.609, but a more forceful down move would be required to signal the start of a corrective phase.

UK - The Short Sterling instrument has eased back from a new contract high at 99.44 to probe near-term uptrend support at the 50-day Moving Average. A breach could leave prices susceptible to a further drift toward the December floor around 99.35.

Europe - The overbought rally by the Euro 30-year Buxl issue has reacted from the latest contract high at 168.86. A jump past that level would be required to remove the risk of a deeper correction.

Asia - The Australian 10-year Bond Continuation chart sees the rally surge up to prior resistance at the early-2015 ceiling near 97.80. With the RSI indicator in overbought territory, it would not be surprising to see a pause occur hereabouts.

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