Thanksgiving week can't ever be fully trusted to provide an accurate glimpse of market momentum.  In this year's case, it didn't really say much anyway.  Bonds lost ground at first, but ultimately rallied back to unchanged levels on the week.  Most of the move happened on Friday's abbreviated session, thus raising even more questions about the gains remaining intact this morning.  So far, so good in that regard!  Now we move on to digesting the typically active data calendar on the first week of any given month, culminating in Friday's jobs report.  

It's an interesting time for the relationship between economic data and the bond market.  To be sure, the market-moving power of the econ data is "limited" at the very least, but there have been indications that it's not completely absent (which wasn't the case for most of the past 7-8 months).  This new phase of the post-pandemic recovery is all about the battle between vaccine hopes and the unavoidable economic impacts of lockdowns (and other non-enforced behavioral shifts among consumers).  In that sense, the econ data has to count for something.  And since this week brings several of the most consistently relevant reports, it's one of our best chances to check in with the data/market connection.

In general, the market is mostly exhausted when it comes to vaccine updates at this point. Between Pfizer and Moderna, absent any huge surprises, markets have long since priced in widespread vaccine distribution before the end of 2021. It's no surprise to see relatively muted reactions to these sorts of updates.  Before domestic trading began today, Moderna was out with final trial results (they were good), but there was scarcely a detectable market reaction.

In the bigger picture, the trend in bonds has been mildly negative since late July.  Yields have most recently been bouncing near the lower boundary of that trend.  Breaking below the yellow line, and especially below the .79% pivot point would signal a shift to more of a "wait and see" approach, as opposed to one that continues to price in a more complete return to normalcy next year.

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