As has been very much the custom recently, Tsy's are having in "inside day" so far as ranges narrow into ready position before important data.  If you need the refresher, "inside" refers to today's trading range lying inside yesterday's range.  That generally makes for the collision of competing trends at some point and today is no exception.

If the upper trendline on the MBS portion of the chart seems aggressively sloped, keep in mind that the chart scaling is a bit compacted in order to fit two days of prices on to the chart.  Fairly regular waves of chopatility leave us exactly unchanged at the moment with the 4.5 coupon at 102-09.  Treasuries are worse off with the 10yr price down 10 ticks and the yield up to 3.338.  Ha!  If yield RISING to 3.338 is the worst news of the day, I'll take it!

The ostensible culprit for the AM chopatility was economic data.  Given the fact that there were both supportive and desultory components of the data, the volatility makes sense.  It's the same old "offsetting penalties, repeat 3rd down..."  But with a bit more time to trade, stocks are once again making a run at multi-month highs.  I don't think anyone would really expect them to meaningfully take off until the auction shoe drops after 1pm.  Regardless, they seem ready to capitalize on bond market weakness should the stock lever turn out to be in play today (and it has been so far).

Other than that, a vast majority of the week's remaining importance lies with the impending 7yr auction at 1pm.  As always, we'll be back moments after the announcement with results and the initial market reaction.