LIVE MARKETS-Benchmark Treasury yield rises as markets await data

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BENCHMARK TREASURY YIELD RISES AS MARKETS AWAIT DATA

U.S. Treasuries rose on Wednesday, pushing yields lower, as market participants interpreted Treasury Secretary Scott Bessent's comments as supportive of the long end of the curve. Additionally, worries about job market softness deepened after a private survey on Tuesday signaled employment losses, bolstering expectations for a U.S. Federal Reserve interest rate cut next month.

Speaking at the New York Fed U.S. Treasury market conference on Wednesday, Bessent said auction sizes will remain unchanged for the next several quarters, suggesting steady supply, for now, that should keep government debt prices elevated and yields lower.

The U.S. 10-year Treasury yield ended Wednesday at 4.067%.

On Thursday, investors are awaiting indications on the U.S. economy and the monetary policy path after President Donald Trump signed a bill ending the longest government shutdown in the country's history. With this, the 10-year yield is now rising to around 4.11%.

On the charts, the yield's trend since its May 4.629% high remains defined by lower peaks and troughs.

Traders are eyeing a wealth of support that includes the October low at 3.936% and the log-scale support line from the April 2023 trough, which is now around 3.90% on a weekly basis. The rising 200-week moving average is now at about 3.87% and the early April low was at 3.86%.

A weekly close below these levels can open the downside for a test of the upper boundary of the monthly Ichimoku Cloud, which is now around 3.64% and the September 2024 trough at 3.599%. However, the April 2023 trough at 3.253% can be a magnet further out.

If the yield can bounce off support, it can maintain the contracting range, which has been in force over the past several years, and suggest another oscillation higher. Initial resistance is at the early November and late September highs at 4.163% and 4.201%.

A weekly close above the upper boundary of the weekly Ichimoku Cloud at 4.29% can refocus on the log-scale resistance line from the 1981 high, which is now around 4.75% on a weekly basis.

(Terence Gabriel)

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