MBS prices are cutting a beautiful (or ugly, in terms of the implication) "Z" on the chart today.  Prices were higher to start the morning and moved almost straight down during the morning data.  The midsection of the "Z" was drawn over the next few hours as we rallied back, eventually getting close to the day's best levels. 

But the final stroke of the "Z" (this is a backwards Z that's fallen on its side, by the way) began at 1pm, right after European markets closed.  That's not meant to imply causality, but it's always interesting to note the correlation, especially considering that Eurozone officials were coming out of a meeting where they were likely to decide that Greece would receive its bailout funding (later confirmed).  By the 3pm Treasury close, bonds were back near the lows of the day.

The net effect is a week that contained a sharp, unexpected rally, ostensibly breaking out of 2015's uptrend, only to have that rally fully erased by the end of the week, with the uptrend remaining intact.  Could we just as easily break the uptrend next week?  Sure, but it's always disheartening to hit the edge of a trend and fail to break through in a friendly direction. 

Whatever the case turns out to be, there's a decent chance that next week's Fed Minutes will play a key role.  This will give markets a chance to look for more details behind the Fed's decision to include the word "some" in reference to how much labor market improvement it would need to see before raising rates.