Many traders were expecting the bond market to retreat once the Dow crossed 20,000. Some thought this would be a sell signal. But the Dow crossed that level at the opening bell on Wednesday and didn’t look back. Thursday’s opening was milder,but the market isn’t shying away from going higher after reaching a milestone. The theme again today is upbeat global markets and good earnings news.

Bond traders were hoping to see buyers for bonds when the 10-year hit 2.50%, but they were disappointed. There was more selling in all global bond markets last night, and the 10-year is 2.54% after hitting 2.55%. The lack of buying at the 2.50% was afail for the bull crowd, but it wasn’t a key fail. The key level the charthead crowd is watching now is the 2.60% level.

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If the 10-year yield breaks above that level and stays above, the next target/resistance level is all the way to 3%. But no one expects any test of the sort so soon. Maybe that’s your first warning sign to buckle up for a quick bolt higher. Lastyear the 10-year spent July through September caught between 1.50% and 1.75% and was usually stuck inside an even narrower portion of that range. If the 2.60% level holds, we’re probably looking at an extended period when the 10-year tradesfrom 2.40% to 2.60%.

Dwight Johnston is the chief economist of the California and Nevada Credit Union Leagues and president of Dwight Johnston Economics. He is the author of a popular commentary site and is a frequent speaker at credit union board planning sessions and industry conferences.