Have We Mentioned The Pre-CPI Trading Range?

Heading into the week, the absence of tradable data on 3 out of the 4 days was readily apparent.  Bonds were left at the mercy of tradeflows (all the trading that’s happening regardless of econ data and headlines) and perhaps technicals.  There’s still a chance that a shift of power in congress could spark a small but noticeable reaction in the bond market.  Apart from that, the only other scheduled event that may register a response today would be the 1pm auction of 10yr Treasuries.  Otherwise, we remain where we have been since the Fed meeting: in a narrow, sideways range near long-term high yields, waiting on tomorrow’s CPI data for clarity.

In terms of trading levels, 10yr yields have been almost exclusively inside the range seen the morning after the Fed meeting.

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While we might see a challenge to one of the nearest technical levels today, tomorrow’s CPI data is more than capable of crushing long term high yields, or the recent lows.

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