Bond markets began the day by putting in a repeat performance of yesterday's overnight and early morning hours. Both days say a 3-4 bp drift higher overnight and another 3-4bp spike in yields ahead of 9am.

Today's version didn't have as pleasant of an ending though. yields continued to drift sideways to slightly higher. Fannie 3.0s remained stuck under 103-08, right in line with yesterday's weakest levels. When prices are repeatedly hitting their heads on a ceiling that was yesterday's floor, it's never good.

MBS buyers went on a more serious strike just after 2:30, resulting in a quick eighth point drop to 102-30. The move had roots in an oil price spike that pushed Treasury yields and stock prices higher starting around 1pm.

From a technical perspective, yesterday now stands as a failed test of a break below 1.70 in 10yr yields. Similar weakness tomorrow would threaten critical support at 1.84.