Short Term Elliott Wave view suggests the decline in Ten Year Notes (ZN) from November 20 high is unfolding as a 5 waves impulse Elliott Wave structure. Down from November 20 high, wave 1 ended at 137.075 and bounce in wave 2 ended at 138.08. Wave 3 lower remains in progress and unfolding in 5 waves impulse in lesser degree. Down from wave 2, wave ((i)) ended at 137.23 and wave ((ii)) bounce ended at 138.05 as an expanded flat.
The Notes then extends lower again in wave ((iii)) towards 136.16 and bounce in wave ((iv)) ended at 136.24. Expect wave ((v)) of 3 to end soon, then the Notes should bounce in wave 4 to correct cycle from December 21 high before the decline resumes. Wave 4 is expected to unfold in 3 waves zigzag. Ideally it should reach 23.6 – 38.2 Fibonacci retracement of wave 3 before the decline resumes. As far as wave 2 high at 138.08 remains intact, expect rally to fail in the sequence of 3, 7, or 11 swing for more downside.