Be still, our beating hearts! This morning's economic data came out weaker and bonds instantly engaged in a logical and sensibly-sized rally. Trading levels were weaker ahead of PMI and New Home Sales Data. The lowest PMIs since early 2020 and the lowest New Home Sales since early 2016 took a sad song and made it better--at least for now. The day is young and the market is generally defensive. In other words, it's a refreshing start, but not one that advocates complacency.
In the bigger picture, this morning's weakness in bonds was fairly important because it brought yields up to a technical level we haven't seen in more than a month, but one that was arguably the most frequently hit ceiling for 10yr yields (3.07%). If bonds are able to build on these gains it would build an even stronger case for the sideways, volatile range.