In the day just passed, the bond market sold off in rather underwhelming fashion.  There was no overt source of pessimism and the pace of movement lacked a sense of urgency.  10yr yields almost made it back into positive territory in the mid-morning hours before moving steadily higher into the afternoon.  Fannie 3.0 MBS were actually positive for most of the day.

In the day ahead, bonds will consider the chart-based implications of yesterday's bounce as the econ calendar builds for the week.  By bouncing at slightly "higher lows" yesterday, bonds are making a case for a bigger-picture consolidation trend (lower highs and higher lows) as seen in the chart below.  At least, they were yesterday!  As this trading day begins, yields are already back near yesterday's lowest levels and/or Friday's latest levels.  In other words, the newly-suggested consolidation pattern is already threatening to break.

Whichever way we end up going today, it likely won't be a factor of the economic data.  The only significant report is the Producer Price Index, which is not a reliable market mover.  Thursday's Consumer Price Index is more likely to have an impact.  The Treasury auction cycle remains a consideration as well as tomorrow's FOMC Minutes at 2pm.