This is the off-season for bonds, but they still have to show up for the game every day.  The coaching staff (aka the traders turning the cogs of the underlying bond market) have been running the same play every day since June 27th.  It's a play that's been working on both offense and defense, thus providing an easy button for the entire team (even if it's also a "boring button").  No one gets hurt, and no one has a ridiculously good time--typical off season.

So what's the play in question?  Simply put, bond market players have been tasked each day with playing harder and harder defense whenever yields rise toward 2.88.  On offense, they only push hard enough to get yields to 2.825, as seen on the following chart with numerous bounces on the lower teal line.

2018-7-16 open

I included the green lines to offer an alternative way to look at the recent range.  The lower green line doesn't have quite enough activity to be very likely.  If we managed to see a rally that broke below 2.825% early this week, however, that lower green line could quickly become more relevant.

In terms of data and events, with Retail Sales already out of the way, there's not much else in terms of big-ticket market movers.


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 4.0
101-30 : -0-02
Treasuries
10 YR
2.8454 : +0.0144
Pricing as of 7/16/18 9:03AMEST

Tomorrow's Economic Calendar
Time Event Period Forecast Prior
Monday, Jul 16
8:30 Retail Sales (%)* Jun 0.5 0.8
8:30 NY Fed Manufacturing Jul 22.00 25.00
Tuesday, Jul 17
9:15 Capacity Utilization (%) Jun 78.3 77.9
9:15 Industrial Production (%) Jun 0.6 -0.1
10:00 NAHB housing market indx Jul 68 68
Wednesday, Jul 18
7:00 MBA Purchase Index w/e 261.5
7:00 Mortgage Refinance Index w/e 958.5
8:30 Building permits: number (ml)* Jun 1.330 1.301
8:30 House starts mm: change (%) Jun 5.0
8:30 Build permits: change mm (%)* Jun -4.6
8:30 Housing starts number mm (ml)* Jun 1.320 1.350
Thursday, Jul 19
8:30 Philly Fed Business Index * Jul 21.5 19.9
8:30 Jobless Claims (k) w/e 220 214