The Day Ahead: ECB Announcement and Jobless Claims

Yesterday, we began by pondering whether or not the ADP Payrolls or ISM Non-Manufacturing data would "break the monotony" that had, thus far, pervaded the week.  As it happened, they conspired to do just that, and to the benefit of bond markets no less!  Perhaps most interesting is the fact that bond markets made no apologies for blatantly waiting on and reacting to ADP data (and to a lesser extent, ISM) as the day's biggest ticket.  It was pretty entertaining actually.  Look at the utter containment run into 8:15am ADP data...  

MBS didn't have quite as much of a bull-run as Treasuries, but they don't normally keep pace when things are moving this quickly.  Even then, we still managed a 10-tick gain, definitively breaking above the 103-10 technical level that stretched back to last summer as a pivot point and moving up to 103-18 resistance.  The next ratchet-click higher looks like it would be the gap beginning at 103-24, stretching up to 103-28, centered on 103-26.

Whether or not MBS even have an opportunity to conduct such ratcheting behavior is largely dependent on European Central Bank President, Mario Draghi, who begins his post ECB announcement press conference at 8:30, as well as the Jobless Claims data beginning at the same time.  It's not that either of these are necessarily watershed events, especially when compared to the Employment Situation report that will follow 24 hours later, but they arrive at an important time, when bond markets--like a base-runner--are deciding whether or not to extend the lead-off, or play it safe.  It's tougher going from current levels, and today's data and events would need to make convincing suggestions if they're to alter the pre-NFP stance that seems to have been already worked out on Wednesday.