MBS are being dragged down enough for some lenders to be considering negative reprices, but the brunt of this morning's weakness is being born by Treasuries. In terms of day-over-day change, MBS are right in line with yesterday and the reprices are a factor of beginning the day in stronger territory and moving weaker intraday.

Treasuries also began the day in stronger territory after following European bond yields lower overnight, but nonetheless remained in their recent broadly sideways trend.  The only caveat is that the range has been expanding as the week progresses.  This looks like a bullhorn on a chart.

What does it mean?  Not much in this case.  Historically, it could have been viewed as a series of high-conviction responses to disparate data and headline events.  These days, it's more to do with illiquidity than anything.  It's just so much easier for a small imbalance in tradeflows to result in swings that look bigger and more important than they actually are. 

Today's key consideration is a conservative pre-auction "concession" trade.  This isn't likely to change before 1pm.  The tradeflow momentum that will dictate the rest of the week's pace should become apparent after 1pm.  From a technical standpoint, a break above 1.95% in 10yr yields could bring more sellers into the market.