After last week’s minor recovery the 30-year U.S. Treasury Bond extended its breakout from its 2.5-year lower Bull channel line (163-26) and plunged to extend its 4-month downmove to levels not seen since the beginning of the year. Last week the 10-year broke out from its month long slumber and narrow consolidation band to extended its 4-month downmove to a 0.618 retracement of the 2.5 year upmove and is within striking distance of its 2.5 year Bull trend line.
Before the election, there were dire predictions about a Donald Trump presidency may mean for the US stock market, with some prognosticators calling for a -7% (seven sigma!) drop on the first day. Those grim forecasts appeared on point on election night, when U.S. markets were halted limit down (-5%) at one point overnight.
Last week the Bond traded in an extremely narrow 2-08-point weekly range and posted an Inside Week and Inside Day Up as the Bond settled in the middle of the previous week’s range. The 10-year finished the week grinding higher and posted an Inside Week Up.
The market reaction to this morning's jobs number was somewhat muted, likely maintaining lower volumes ahead of Tuesday's election. The level we have been noting, 2086, has served to be somewhat of a magnet. Major energy products are declining today, with WTI crude oil trading below $44 per barel briefly.
Early Friday, Sept. 30, all Treasury products (30s, 10’s, 5s and 2s) either tested or posted their respective weekly highs and plunged throughout the session to finish the week at the lower end of their respective weekly ranges.