September was a pretty good month for bond markets, assuming you're able to overlook the fact that it took a massive sell-off with 10yr yields hitting 3% to set it up.  October was a bit better, but much weirder as markets tried to sort out government shutdown affects vs reality.

Everything else has been awful for bond markets since May.  Even the pockets of recovery and consolidation have only been made possible by brutal, spiky sell-offs immediately prior.  In fact, the current pocket of correction is the very first we've seen since May that follows a much less volatile (albeit weak) cycle over the holidays.

With that in mind, it's hard to simply go back to accepting that positive price action in fixed-income means anything.  It's hard to trust the current technical support.  For all we know, our tormentors are just in the middle of a shift change and the beatings will resume shortly.

Nonetheless, the technical support is there, and it has actually formed a few nice ledges and pivot points that allow the optimists willing to learn to love again a bit of a safety valve should things start going south again. 

In other words, if you want to be bullish and hope for the best here, 103-16 in Fannie 4.0s is a good time to start getting skeptical.  Not pictured above, but 103-10 is also a well-traveled technical pivot, and of course there are simply the outright lows in the chart under 103, if you want to push your faith to the limit.

Here are some more detailed Treasury levels that can help assess the strength of support:

The lower chart has the same horizontal lines as the upper chart, but is zoomed in so we can see how 2.875 held up on Tuesday and how 2.84 offered resistance yesterday.  A break of 2.84 sets up a more important battle with 2.82.  A break above 2.875 is a bridge we'll cross in tomorrow's updates if we happen to move that much weaker.

Today's data will help decide that.  None of it is epic, but it's a respectable slate for a Friday.  Housing Starts has some market movement potential at 8:30am.  Industrial Production at 9:15am was a mover at it's last showing on Dec 16th, but isn't a big-ticket item.  Finally, Consumer Sentiment at 9:55 brings another merely moderate risk of movement before the drift into the 3-day weekend commences.