Bonds took Trump at his word in the wee hours of Tuesday morning with respect to waiting until Nov 2020 (or later) to finalize a trade deal with China.  I suggested that was a silly thing to do at the time because not only was it likely a mere negotiation tactic, but there's also too great a risk his hand is forced well before then.

As Thursday begins, the buzz is that the impeachment hearing could be one of those things that forces his hand.  In other words, beating the Dec 15th tariff implementation deadline, presenting the world a phase 1 deal, and utterly juicing the stock market 2 weeks before Christmas would make him look rather triumphant (and thus perhaps raise additional doubts about the impeachment process).   

All of the above is a cute and tidy little narrative, but reality is stranger than that fiction.  Markets don't believe the Senate will ever vote to remove Trump from office, even if traders are willing to speculate that Trump may be more eager to push for a deal in December to take the focus off the impeachment process.  Even that may be a stretch when it comes to explaining market movement.  Case in point: bonds are weakening this morning even as stocks come off their highs.  If the narrative above were truly the market mover, stocks would be pressing to new all-time highs.

This isn't to say that trade deal prospects are irrelevant.  The trade deal is still the most relevant market mover we have.  But surrounding that, there are ancillary motivations like supply, uncertainty, near-term economic momentum, and even more obscure factors like European political surprises (i.e. Germany potentially increasing public debt, which puts upward pressure on rates). 

Last but not least, or rather, tangentially related to the broad topic of "uncertainty," we have TECHNICALS.  The concept is pretty simple.  There are too many unknowns for bonds to have strong conviction about breaking above early November high yields or below September's lows.  So bonds can simply take cues from their location in that range, the amount of time spent there, and the speed with which they got there (3 basic aspects of constructing a technical trading strategy). 

At the simplest level, Technicals are neutral-to-negative for bonds right now, with 1.73/1.74% continuing to offer resistance underfoot.  The implication is a higher probability of a move back up to one of the ceilings highlighted below.  That conclusion was in question on Tuesday morning, but bonds have forgotten all about that now.