Amid the recent slow summertime trading, there are only a few things that stand a chance of catching the market's collective eye.  Somewhere near the top of that short list is "geopolitical risk"--a term that literally has to do with international relations as a function of geography, but that financial markets have somehow twisted into a catch-all term referring to any sort of conflict/tension outside the US that could result in financial markets shedding risk.

When financial markets shed risk, traders tend to move to cash or into lower-volatility, liquid investments like Treasuries.  This causes the classic "risk-off" move of lower bond yields and lower stock prices.  That's exactly what we saw overnight as North Korea launched a missile that flew over Japan.

We'll no doubt witness how events unfold in the coming days, but for now, the initial reaction has taken 10yr yields through both of their key resistance levels (2.16 and the 2.10-2.12 lower boundary for 2017).  In addition, 10's "tested" the lower boundary of their downtrend (yellow lines in the chart), but haven't been able to maintain that level of aggression as domestic trading begins.  

The downside to this short-term technical victory is that it may set us up for a bounce if tensions happen to subside for any reason.

Away from the North Korea news, we'll get just a bit more by way of economic data today in the form of Consumer Confidence at 10am.  This is a hit and miss market mover of late with the general tendency being an absence of a market response except in cases of exceptionally big deviations from expectations.  Finally, the Treasury auction cycle wraps up with 7yr Notes at 1pm.