In the day just past, bonds continued to push feverishly into the lowest yields since 2017.  In fact, 10yr yields were only about 1bp away from the lowest levels since election week in 2016!  All told, the rebound from late 2018 has traversed well over 100bps, making this one of the 8 biggest moves in the past 20 years and making 2019 the first true "rally year" since 2014.

In the day ahead, we're left to ponder whether all that strength is merely a correction to the overdone sell-off in 2018 or confirmation that the US will inevitably join Japan and Europe in a long, slow grind toward (and below, at times) zero percent rates.  More immediately, we're left to consider whether overnight weakness is a sign of a reversal in momentum or just a logical technical correction to all the recent strength.  The former would be worth panic, but the latter merits patience.

To whatever extent investors aren't sure which P-word to choose, they could place some more stock in this week's remaining economic data.  Unfortunately, today is the lightest day of the week in that regard (no significant reports).  There are some Fed speakers, including Powell around 10am, however.  Those speeches could help frame Bullard's comments from yesterday, which were fairly dire and unquestionably helpful for bonds.

From a technical standpoint, we can watch the following levels to gauge the severity of any additional selling pressure.  Overnight highs are right in line with the first ceiling.  If yields manage to hold below that ceiling for the rest of the day, it would be another feather in the cap of the 2019 bond rally.