Overnight the 16 European nations agreed to an aid package of €750 billion ($962 billion) for their “most indebted” countries. And just as quickly, interest rates for Greece, Italy, and Spain declined significantly: Greece, trading recently in the 12’s, dropped over 4.5 points to 7.75% Italy and Spain, likewise dropped to the upper 3’s. By the morning’s openings, US notes had opened higher, at about 3.55%
This is good news for everyone–particularly for Europe–as stability in the markets is good for growth. And part of the US rise to 3.5% is a function that “flight to quality” money flow was somewhat “overbought” — which is to say, when something moves quickly, it will commonly retrace a bit to find an equilibrium.
From a technical point of view, 3.5% appears to be a cusp number, and the likely upside interest number seems to be about 3.65%. Support numbers are at 3.48% and, if moving past that, 3.64%. Resistance numbers (to moving lower) are about 3.43% and 3.42% (Which is all to say that it should trade in a range of 3.42–3.64%.)
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