Bond yields on the 10-year U.S. Treasury note were as low as 2.356% on March 27, 2019. Back then, the leading financial stocks like JP Morgan Chase (NYSE:JPM), Goldman Sachs (NYSE:GS), Bank of America (NYSE:BAC) and most other financial stocks started to move back to the upside after a sharp five-day decline that started back on March 19.
By now, every trader and investor knows that the stock market cannot have a sustained rally without the participation of the leading financial stocks. Currently, the yield on the 10-year U.S. Treasury note is around 2.55%, so simply put, yields have jumped by just 20 basis points. That is not a big surge at all, but it has helped out the financial stocks and given confidence back to the marketplace.
It looks like the 10-year U.S. yield found support at the 200-week moving average on March 26, 2019. This is certainly the key level that traders must now watch. If yields start to fall again on the 10-year note, it could be problematic for the current rally. Should yields decline below that important pivot low at 2.356% then it will likely bring some serious fear into the financial stocks again – and possibly the entire stock market. At this time, the next important resistance level for bond yields will be around the 2.65% area. Right now, the 10-Year Bond yield is telling you everything you need to know.
