When 10yr yields and MBS both hit 3pm at essentially the same levels as 11/9, and subsequently pulled back, it suggested that we might have hit some sort of technical wall that would continue to provide resistance in the overnight session.  Indeed that's proving to be the case so far today, and the rest of the will be all about assessing whether or not the current level of weakness in bond markets is "just right, not enough, or too much," and all without economic data (apart from the relatively inconsequential Leading Indicators at 10am) to offer guidance.  European events are happy to offer guidance though.  The problem is that they don't adhere to a schedule and make no promises as to whether or not they'll help, hurt, or even show up at all. 

Here's the morning alert from MBS Live:

Treasury Yields Back up Overnight, MBS Set to Open Lower 8:27 AM

A familiar cast of "risk-on" characters combined to help stock futures, the Euro, and Treasury yields climb higher last night. MBS opened about 4 ticks lower than yesterday's 5pm levels and are currently at 101-24. S&P futures are currently in the mid 1220's after falling below 1210 yesterday and 10yr yields are just over 2% after falling just below 1.95 yesterday and again earlier in the overnight session. 

But shortly after 3am New York time, the "risk-on" light started getting brighter amidst decent, but not overwhelming volume. Beyond the obvious technical considerations of both US Stocks and 10yr yields hitting their November lows yesterday as well as the fact that it just "feels like it was about time for" a reversal of the risk-off trading of European headlines based on recent runs in sovereign debt spreads and the like, a few market movers to note from the overnight session include: 

- ECB chief Draghi calls on EU governments to act quickly in utilizing the EFSF bailout fund 

- This also fueled earlier speculation that the ECB will soon be directly injecting capital as opposed to buying EU debt

- Speaking of which, the ECB continues to buy EU Debt, a fact that buoyed sovereign debt overnight

- Germany's Schaeuble says Greece is a one-of-a-kind issue

There's really nothing on tap as far as economic data today. It's a longshot for Leading Indicators at 10am to ever be a market mover and the first instance of Fed Speak from NY Fed's Dudley is already out with no market reaction. With 10yr yields around 2%, we're already seeing much of the correction we (probably) expected after yesterday's technical wall was hit, and could really go either way from here.