US treasury yields have soared across the board after the more hawkish FOMC announcement earlier this week, whereby Bernanke openly stated “the Committee currently anticipates that it would be appropriate to moderate the monthly pace of purchases later this year…we would continue to reduce the pace of purchases in measured steps through the first half of next year, ending purchase around midyear”.

This saw the 10-year yield break above notable levels of resistance:

• 2.33% – 2010 Low
• 2.384% – 38.2% retracement of 2010-12 decline
• 2.39/42% – October 2011 & 2012 Highs

Additionally, weekly RSI decisively broke above the key 65 level (signaling the end of downtrend). Earlier today the 10-year yield broke above the key psychological 2.50% level, which is a point not seen since August 2011, and potentially opens the door to further upside momentum.

Next potential resistance levels:

• 2.57/58% – 50% retracement of 2011-12 decline & 200-week sma
• 2.75% – Trendline resistance drawn from 2007 high

Interestingly, weekly RSI appears to have broken above corresponding trendline resistance in advance to price, which suggests at minimum a test of the noted 2.75% level, with a potential break above it over the coming weeks.

Source: Bloomberg, FOREX.com