Bonds are beginning the day in roughly unchanged territory, but that's not a good thing as far as the bigger picture is concerned.  "Unchanged territory" means that yields are right on the edge of a very long-term range.  In fact, with the exception of failed breakout attempt in late October, 10yr yields have held under a ceiling of 2.42% since March!  

It's not just a ceiling that saw an isolated bounce either.  The 2.4-2.42 zone has been attacked on multiple occasions--each time acting as support for an impressively resilient bond market in 2017.  Now with a tax bill vote looming in the Senate, we could be looking at "the thing" that finally challenges that ceiling (and beats it).  At the very least, it seems that bonds are staging for this eventuality.  If we do see a break over 2.42, the 2.47 level becomes the next critical defensive ceiling.  

The tax bill doesn't necessarily doom rates to an eternity spent moving higher.  After all, a good amount of the associated weakness is already priced-in.  For now, the tax bill is merely through committee in the Senate.  It could pass the Senate today or tomorrow however.  If that happens, it would still need to go back to the House before making it to the president's desk.

From what we've seen so far this week, it will be a small miracle (both for the American people and for rates in the short term) if Congress fails to pass a bill.  The silver lining to that short-term pain is that the new tax policy would likely make income inequality issues even worse, thus further driving the "mysterious" absence of inflation and productivity that rich economists can't seem to decode.  And an absence of inflation and productivity will contribute to even lower rates in the future.