US long-term treasuries have been on the rise since the start of 2022. Expectations of a FED rate hike cycle, ending asset purchases and persistent inflation is fueling the rise. Now the rate is testing the April top. If broken, further rise with a %2 target will be a high possibility. %1.67-%1.70 might be followed as key support for short-term direction. For a possible reversal from the top, this support zone might be the main signaler.
US 10-Year Treasury rate also affects the dollar, stocks, and precious metals. Gold has a high negative correlation with real rates which is heavily influenced by the treasury rates. The negative correlation between the 10-year rates and gold gets even higher when the volatility of rates gets higher. That means a breakout might mean a possible sharp fall for gold and other precious metals.
Gold is currently testing the 1825-1834 resistance zone which is limiting the upside moves since last summer (except for one time). Depending on the 10-year’s direction, gold may decide as well after the CPI data, a bullish break or return to below 1800.
