The headline is pretty ominous, but not for any particular reason. It's merely an observation of where we've been over the past few weeks, namely, moving back into 2014's dominant sideways range.
"Hey! Moving sideways doesn't sound too bad!" you might say, but it's more about the fact that we're quickly being forced to accept that yields have officially broken out of their April-May downtrend. If anything this week can help even the odds, it's probably going to happen tomorrow, but we're close enough to a key intermediate technical level today to get some clues as to the underlying momentum.
In other words, a firm bounce on 2.66 would let us know that bonds haven't simply rolled over and accepted their fate on this potentially dark path. Even if yields break higher, Thursday's data and events could easily push them back below 2.66.
There is no significant economic data this morning, but the afternoon brings the moderately important 10yr Treasury Auction at 1pm.
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