From a technical standpoint, bond markets are playing a dangerous game at the moment.  We'll consider this dangerous game for a moment against the backdrop of 10yr yields.  Monday was somewhat troubling in the sense that 10's hit all-time low yields right on the nose without going any lower.  Since then, they've been ratcheting higher, using previously supportive ceilings as new floors of resistance--sort of "stair-stepping" higher in yield if you will.  Here's how it looks on a chart.

Now... We've been pretty vocal about not seeing any reason to be flustered about potential technical developments, and this one's no different really.  There's not much that 10yr yields could do today, short of a convincing break above 1.56 that would make us think that bond markets were interested in doing anything besides this whole "low and sideways" thing they seem to have going.  And we'd imagine that whatever does "fluster" us would be a fairly big and noticeable development.  

So could that happen today?  Could Bernanke say something today that he didn't say yesterday that would be significant enough to confirm an ongoing bounce higher in yield (or lower in MBS prices as the case may be)?  No, he can't.  You might think "well, anyone can say anything, and he might say something different!"  While that would be true if Ben was human, such theories lose water when you consider that he's a monetary policy machine who has no history of such slip-ups.  This is all sort of a roundabout way of saying that we're pretty sure Ben's cards are on the table and any big market movers would likely be more European in origin.  

Domestic data could have a bit of pull as well, but it would necessitate Housing Starts crushing the consensus by more than the report's margin of error.  If that happens, go buy lottery tickets, don't stand in rainstorms, and enter a blind-folded half court shot competition because winning the lottery, getting struck by lightning, and sinking a blindfolded 3 pointer are high probability events compared to Housing Starts "saying something" that can't be explained away by the reports margin of error.  

So we're left with the likelihood that data does nothing in the morning and Bernanke giving the same prepared remarks as yesterday, culminating in getting the same raft of ridiculous LIBOR-related political posturing from Congress.  Could someone ask Ben a NEW question that, in some way, informs today's trading action?  Yes, that's possible, but only slightly more probable than sinking blind-folded half-court shots.