At times like this in bond market history, the collective psychology is akin to the cliche ne'er-do-well from a book or movie who has finally come into a string of decent luck.  This character has a hard time enjoying the good luck and an even harder time imagining it will continue.  After all, he's been conditioned to expect disappointment.

2015 would have been the start of this particular book with the initial gains setting us up for a somewhat major reversal of fortune.  That certainly began in February when rates lifted off the long term lows in late January.  It might not seem like it, but ever since then, we haven't seen more than 2 back to back weeks of improvement--until last week.

The 3 week winning streak made July the only month of the year strike back against weakness in the previous month in any significant way.  March is a contestant here, but the gains didn't make it far into February's range.

One of the only troubling things about July's gains is that they look similar to those seen just before the taper tantrum began in 2013.  In both cases, yields were in a linear uptrend after hitting long-term lows AND had fallen back to the lower end of that trend channel.  Another potential similarity is that major shifts in Fed policy were afoot in both cases, but that's a stretch (to put it mildly).  Still, should we freak out about the other similarities hearkening a similar explosion toward higher rates?

Probably not just yet.

On a more qualitative note, the taper tantrum was more of a blindside.  Sure, Bernanke had talked quite a lot about it in March, but markets were dismissive considering NFP releases in March and April were extra weak.  It would have taken a heroically strong NFP release in early May and massive revision to the previous 2 months to get markets thinking more about what Bernanke said in March. 

Of course that's exactly what happened and the rest is history, but in the current case, we're not setting up for the same sort of blindside.  Markets have largely accepted a Fed rate hike, and have visibly been pricing one in for quite some time.  If any blindside is possible, it would be for this week's data to somehow confirm last week's rotten wage growth numbers.  Please understand, this is a long-shot, to say the least, but if Monday's Incomes data  and Friday's average hourly earnings (in the Jobs report) paint a similar picture, 2015's uptrend will likely be definitively broken.