• Bonds weakened initially, but bounced back during European hours
• Bonds also defied rising stock prices to hold their ground
• Bonds also defied a ton of "issuance" to hold their ground
• Bonds also defied a potential shift in technicals to hold their ground
• And so on and so on...

The moral of today's story is that it could have been a lot worse given the hurdles faced by bond markets today.  There really wasn't much movement to speak of--MBS never left a measly eighth-point range--but that it is a victory in itself.  

The technicals have recently been looking like they were running out of steam.  It wouldn't have been a surprise to see bonds push back toward the other end of their consolidative "triangle" that we discussed yesterday.  It would have been even less surprising considering there is a ton of "issuance" (new bonds coming to market in the form of Treasuries and corporates) this week as well as rising stock prices and stable, higher oil prices.  Yet bonds defied all the negative implications and managed to end the day essentially unchanged.  

This could be exclusively due to global bond market momentum that carried European yields to their 1-month lows today, but we won't know how willing Treasuries are to remain resilient until we see how things shake out after the week's remaining auctions.  Those happen at 1pm on the next 2 afternoons.  If we see any significant move toward higher rates, we should assume it's at least a token consolidation back to the higher side of the triangle.