Treasury prices have been steadily declining ever since Yellen's gaffe where she unwittingly suggest that higher interest rates will come sooner than when market expected. She has since tried to correct that perception by implying that the Fed will keep loose monetary policy for as long as needed, but it seems that fixed income traders are not moved and continue to drive 10Y prices lower.
To be fair, it should be noted that risk trends are broadly bullish, and that has a natural bearish impact on safe haven assets such as Treasury that earns a lesser yield. Hence, we may need to hold our praises for bears as they are not exactly running against fundamentals right now as we approach 124.0 round figure.
Given that Stochastic indicator is approaching Oversold region, the likelihood of a break of 124.0 and strong bearish follow-through becomes lower as Stoch curve will most likely be within the Oversold region when that happens. With 124.0 holding up strongly during past 2 tests it is clear that there are still staunch bulls lying in wait around these levels, and without evidence to the contrary it will be more prudent to assume that bulls remain lurking around. As such, traders who wishes to play a 124.0 bearish breakout scenario should seek further confirmation for the breakout.
On a related note, it should be noted that current 10Y yields are trading at an implied yield of 2.799%, which is relatively far from the 3.00% line in the sand. This is a huge difference from the past 2 times when 10Y Futures (which OANDA CFD is based on) were trading close to current levels implied interest was at 2.99% ( Sep 2013) and 3.03% (Dec 2013) respectively. This suggest that fixed income traders are not truly bearish Treasuries, and may simply be selling near-dated delivery Futures as hedging purposes. The implication of this (if true), would be that market isn't truly believing that the Fed will hike interest rates earlier than expected. This charge makes sense as US economic figures haven't been performing well, and it seems that the rest of the world is also recovering at a less than expected pace.
As such, the likelihood of 124.0 breaking this time round becomes even lower, but traders who want to play a potential rebound at 124.0 should also note that long-term direction for Treasury prices is lower and a move towards 128.0 is equally if not even less likely.