Weekly Wrap: With This Market, The Devil Is In The Details

This week the yield of the 10-year Treasury reached over 3.12%, a level not seen since 2011 and the 2-year rose over 2.5%, to levels last seen in 2008. The spread between the 2-year (2.573%) and the 30-year Treasury yield (3.246%) remains near multi-year lows. With the market pricing in a more than 50% likelihood of three additional 25 basis point rate hikes by the end of the year, up from 33% just a month ago, the potential for an inverted yield curve in 2018 is a material possibility.

Looking at the charts for the 10-year, the next potential upside targets are around 3.75% and 4.0%, the peaks formed from 2011 to 2010.