Panic in the bond market | 26 Tháng Mười 2023

26 Tháng Mười 2023, EUR/USD

EURUSD trading plan:

The bearish trend in this currency pair is accelerating! The yield on 10-year US government bonds has already risen above 4.95%, providing good support for the Dollar. These securities are benchmarks used by investment funds and banks, and since their yield is higher than inflation, it is profitable for investors to buy them, as the yield on German bonds, which are key in the Eurozone, is well below inflation. The yield differential will support the Dollar until the end of the week. There are two reasons for the rise in US Treasury yields. The first is low demand from Chinese investors, who have been shifting their investments into gold in recent months. Second, large margin positions in this market are forcing mutual funds to sell some of their securities because they can no longer afford to let them slide.

Investment idea: sell 1.0577 and take profit 1.0490.

David Johnson
Analyst of «FreshForex» company
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