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Two days back we observed a deeper correction in stocks during the US session, triggered by some hawkish comments from Fed members. As a result, US yields moved up to the 78.6% Fibonacci level, which often marks the final and critical point for potentially completing corrective price action, ideally up from the May low.

Now that 10Y US yields are back below 4.5% after today's US PCE inflation report, a correction within the downtrend can be completed, so US yields may face more weakness in upcoming days/weeks. This could also stabilize stocks and complete the current pullback from the highs, particularly in the S&P 500, and some other assets as well.

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