US 10Y TREASURY: digesting week is over?

Markets spend the previous week digesting the latest information from the FOMC meeting regarding interest rates levels in the coming period, as well as FOMC economic projections for the next two years. It all created one quite a challenging week on US financial markets, as well as for the US Treasuries. The 10Y yields reached 4.5% immediately after the Fed Chair speech after the FOMC meeting on September 20th, however, during the previous week yields continued to surge further, reaching the highest weekly level at 4.67%. This could be treated as a sort of market overreaction, as yields soon returned to the level of 4.57% where they are finishing the week.

Yields continued to move within an overbought momentum for a second week in a row. This adds to the high probability that yields will further move toward the 4.5% levels which is more realistic to current economic prospectus and wording supported by the Fed. At this moment on charts, a 4.3% level could be the next target for 10Y yields, however, it might take some week or more until yields clearly reach this level.