Another Friday and another opportunity for markets to "trade it out" rather than react to data and headlines.  There's next to nothing on tap for the European data calendar and in the domestic session, we'll get only July Durable Goods, seen rising 2.4%.  But if Thursday's trading was any indication, markets aren't much concerned with a majority of the domestic economic data offerings.

Fact is, the old school importance of economic reports such as Durable Goods has waned significantly into the European-driven flight-to-safety.  Now that we've added the prospect of additional Fed easing into the mix, that further marginalizes the data least likely to inform the Fed's decision.  Implicitly and explicitly they've told us it's about employment first and foremost.  There are a lot of places the Fed can look for a read on employment, NFP being the obvious leader, but Durable Goods isn't one of them.

So that leaves today's session devoid of any of the big ticket, hotly anticipated data release or market event to drive trade.  With Thursday generally confirming Wednesday's rally, and doing so in lighter (but still healthy) volume, we'd wonder if today's session won't be more of a "winding down" of the week in the same sort of way last Friday's was, just at significantly lower yields... With that "little" issue of the FOMC minutes cleared up, and with "so much" time between now and the early September big-ticket events, a few eyes have probably turned toward the exits again, after being reluctantly pulled back to trading screens for the past few weeks.

Levels to watch:

- defensive with a break of 1.71 in 10yr yields

- very defensive with a break of 1.7447

- defensive if we're testing a 103-01 floor in MBS (Fannie 3.0s)

- more defensive breaking to test 102-30

- very defensive at 102-24

If we're on the friendly side of those levels, it's all good and we'll simply update intraday alerts for MBS Live users as necessary.