After today's heavy snowfall in New York turned to rain this afternoon, it's now turning back into snow in the wee hours, scheduled to deposit another 3-7 inches.  For MBS trading, this type of weather takes a toll on participation, especially ahead of a 3-day weekend (President's Day Monday).  Treasuries will be affected as well, but to a lesser extent.  In any event, volumes will be lower overall, and barring major departure from expectations in the data, we're more likely to see one of those Fridays where trading levels march in an orderly fashion toward the exits, with writing on the walls by noon.

Apart from the weather, there's little to discuss other than the three fairly boring, but sometimes market-moving economic reports.  Import/Export Prices at 8:30am is the least meaningful in terms of market impact.  Industrial Production and Consumer Sentiment are on more of a level playing field, but as Sentiment is the later of the two reports (9:55am vs 9:15am), it's reporting will mark the time of day where we'll see the proverbial "final answers" being locked in.

In other words, it's no secret that it'll be harder to find willing counterparties tomorrow afternoon.  It'll be hard enough in the morning.  But it's also no secret that it can be a bad idea to square up trading positions for a long weekend with potentially market-moving data yet to report.  So look to the 9:30-11am time frame as the best chance for volatility, with a greater propensity to drift into the afternoon. 

The technical backdrop:

10yr yields have exited their 2014 downtrend and embarked on an uptrend that's still intact despite yesterday's gains.  Further weakness today would keep the new uptrend intact while moderate strength would challenge it.