Moment of Truth for 10-Year

To examine the long-term trend in a variable, it is often advisable to go beyond merely extending the range of daily charts or using weekly graphs. The chart below shows monthly data from 1995 to the present on the 10-year bond. Notice that at the present time, the 10-year rate continues to range within a symmetrical triangle based on resistance from 2002 and support from 2003. The most recent monthly high is touching the upper line (longer-term resistance). Also, the 9-period RSI is not yet in oversold territory.

Examine the graph and analyze it. (1) What is the likely path of the 10-year rate in the next month or two based on technical considerations? (2) Adding economic analysis concerning the way the "pieces" are moving and fitting together (remember our theoretical discussion of interest rates), does this conflict with your technical analysis conclusion or is it consistent with it?

This is the type of thing you need to be doing as you get farther along in the process of writing your forecast paper.