
Looking at the December 10-year note we have a high of 133-145 and a low of 132-305 and currently trading at 132-315. What we have been seeing in the last few weeks is data coming out on the weak side which has given the note a bid. Today that changed and possibly the trend as well. This morning the street was watching retail sales and was expecting a reading of down 0.8% but instead we saw a somewhat robust reading of up 0.7% which definitely took traders by surprise and we are seeing the yield on the 10-year at 1.35%, which making traders think that chairman Powell might actually taper earlier rather than later. In today’s down move we are currently under the 50-day moving average which currently lies at 133-13 and often is a good predictor of a trend change. Looking at this market from a technical view, I would say selling rallies in the note with protection above the 50-day moving average might be a good trade since, in my opinion, we have entered a short-term downtrend.
