Treasuries and MBS dodged a bullet today in that a strong showing from the Employment Situation Report (aka "NFP" for the primary component: nonfarm payrolls) could have pushed them beyond important support levels.  Instead, the report was weak enough that we got a fairly healthy rally in response, and we're still in positive territory.  That's the good news.

The bad news is that MBS are only up 5 ticks on the day at 102-25, and bond markets in general, have been losing ground since 8:33am.  In other words, we popped sharply higher on the NFP news and have been leaking lower ever since. 

The other piece of the bad news is that Treasuries and German Bunds (which are as important a benchmark for global rate momentum as anything at the moment) both made "higher lows" this morning.  That is to say, they both rallied after the NFP release (i.e. "moved lower in yield"), but the rally stalled out before making it back to yesterday's best levels (leaving us with "higher low yields" compared to yesterday).  That speaks to some level of underlying, bigger-picture bond market weakness or, at the very least, hesitation.