I refer to some Mondays as unofficial 3rd days of the weekend, and today's example qualifies. There were no significant economic reports, no substantive headlines, and no major movement in bond markets. Add to that a general absence of volume (one of the lightest days in more than a month) and we have an ample case for an inconsequential trading day that may as well have been an extension of the weekend.
Bigger decisions are ahead for bonds. That's the sense we were left with as 10yr yields hurtled toward 2.40% last Friday and the reality we were reminded of when today's only interesting tidbit crossed the wires: Trump is "very very close" to naming the next Fed Chair. It doesn't sounds like Yellen is in the running, which leaves the frontrunners as Powell and Taylor.
Traders likely have a bit of bond buying to do if Powell gets the nod and vice versa for Taylor. The possibility of a Taylor nomination broadly coincides with the bond market's reluctance to break below higher-yield pivot points like 2.37% in the 10yr. The hope for a Powell nomination helps bonds defend more dire technical ceilings like 2.40%. If it's as simple as one or the other getting the nod, that's when we stand a better chance of seeing a higher conviction break.
The other yet-to-be-determined market mover is Thursday's big European Central Bank announcement as the ECB previously indicated we'd hear more about their tapering plans at this meeting.