The British pound/U.S. dollar (GBP/USD) was sharply down the last couple of days; the 10-year U.S. T-Notes can be currently trading in a temporary pullback of wave.

Stocks turned sharply lower in the last 12 hours based on 10-year U.S. T-Notes and the correlation with the E-mini S&P 500. Key for that move down was a breakout of an ending diagonal seen on the 10-year, which was a confirmation for a turn into a risk-off mode for stocks.

As clearly observable since no later than early last week, directional trend moves were lapsing into consolidation phases. And with those come a degree of consternation. While it might seem that the less directional trends might leave a more subdued psychology, the memory of the more aggressive trends leave many market participants on edge. That is often due to the degree to which there is concern over not missing the next major price move in spite of the current lower volatility.

We have seen the U.S. dollar moving to the upside in the last 12 hours, following the hawkish tone of the FOMC minutes that send the U.S. 10-year Treasury yields rising to 3%. We see 10-year U.S. T-Note prices still in an ending diagonal.

The current drop can now be part of sub-wave 5 of III, that can take price toward the 119'00 region and lower in T-Notes.

Daily market analysis on the euro, Nasdaq, crude, and more.

Daily market analysis on the Nasdaq, crude, gold, and more.

Daily market analysis on Treasuries,

Daily market analysis on the euro, Nasdaq, Treasuries, and more.

Daily market analysis on the Nasdaq, Aussie, crude, and more.