Treasury Yields May Extend Increase to 3%: Technical Analysis

Sept. 15 (Bloomberg) -- Treasury 10-year yields are poised to extend gains after climbing past their 30-day moving average this month, according to National Australia Bank Ltd., citing trading patterns.

Ten-year rates will increase to 3 percent by year-end, said Peter Jolly, head of market research for the investment-banking unit of the nation’s largest lender. September marked the first month the yield has held above the moving average since April, according to data compiled by Bloomberg.

“We’ve broken the downward momentum” in yields, Sydney-based Jolly said. “At some point, the world economy will recover and jobs will return.”

The benchmark 10-year note yielded 2.69 percent as of 8:12 a.m. in London, according to BGCantor Market Data, above the 30-day average of 2.66 percent. Yields have risen from an 19-month low of 2.42 percent on Aug. 25.

Ten-year yields will advance to 2.72 percent by year-end, according to a Bloomberg survey of banks and securities companies with the most recent forecasts given the heaviest weightings.

In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index.

To contact the reporter on this story: Wes Goodman in Singapore at wgoodman@bloomberg.net.

To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net.