We've made it!  This will be the last day of the excruciatingly narrow range that we began discussing more than 2 weeks ago (the range itself is at least another 3 weeks older than that, but it took some time to take shape and begin it's lullaby).  To be sure, boring and flat are good things when rates are this close to recent lows.  And 'recent lows' are good things when they're this close to all-time lows.  So no one's complaining.

That said, there have been and continue to be risks regarding this particular flat, consolidative episode.  Using 10yr yields to represent broad momentum in rates markets, the sideways grind has been ominous on several fronts.  In a short term, less consequential way, it looks like we may be putting in a bounce on the lower end of the long term trend.  No big deal in the bigger picture considering the long term trend continues pointing toward lower rates. 

A bigger risk is that we're putting in a long term bounce due to our inability to break below the mid 1.8's.  I've referred to this as the gateway to the golden era for rates.  Remaining stuck above is notable and made all the more notable by the fact that we were below just a few months ago.  Therein lies the third risk.  This recent resistance adds up to a periodic "low" that is higher than the last low.  These sorts of "higher lows" suggest a new trend is trying to form toward higher rates.

Of course, tomorrow's data (GDP and FOMC) may well have something very loud to say about that.  Until then, we have a smattering of moderately important data today, including the 5yr Treasury auction.  It would normally happen on Wednesday as well, but the month-end calendar wouldn't have been able to fit in the 7yr auction otherwise.