As with gold, treasuries are rising in anticipation of further QE. I am less sure about this trade — breakouts have not been a wildly successful way of trading this market historically. However, with the yield slipping below 2.5%, this is a major breakout to yield levels not seen since (I think) the 1950’s, and the market has just had a good pullback which means this bull run is relatively young.
I am torn about whether to close the trade or not. With the trend in place and less than 1ATR of profit, the bias must be towards keeping it, and the hope that further QE will create the conditions for higher inflation has been part of the story from the start and has not stopped Treasuries from rallying. I do feel cautious, however — the market could now focus on this aspect of the story.
Here is a chart: