Volume and volatility have left the building this afternoon as markets aren't keen on making any big movements ahead of tomorrow's Employment Situation (NFP). MBS Continued a 3rd day of trading the same fractal where prices begin the day in a wide/volatile pattern, consolidate, break higher, and return to something around 101-26 by the close. All off the preceding can be seen in the live chart below from the MBS Live Dashboard
To reiterate the extent to which MBS are seeking out 101-26, here's a longer term chart of Fannie 3.5's:
To reiterate the extent to which no one is taking any big risks this afternoon, here's a chart of S&P's and TSY's following each other all day and both trading well within the morning range this afternoon.
S&P's in particular are smack dab in at the apex of the epic triangle recently broken, as if to suggest a big beat on NFP, and they'd be ready to move higher--European headlines be damned.
But are 10yr yields ready to move higher? Maybe, maybe not. Certainly we wouldn't want to rely on these 2.11-ish levels as a be-all-end-all sort of support level, but they certainly were for the month of november and markets have as-yet been unwilling to let yields casually drift much higher. That said, a big beat on NFP would likely do the trick, while anything less (if unaccompanied by bond-negative headlines out of Europe) would be harder pressed to do so.