Range-Finding Ahead of a More Relevant Wednesday

Tuesday is getting off to a similar start to Monday when it comes to the level of movement, but this time around, it's in the opposite direction.  Depending upon how the rest of the day goes, this could simply prove to be a range-finding exercise ahead of tomorrow's more relevant data and events (Retail Sales and Fed Minutes). 

The same old technical levels remain relevant for longer-term bonds with one small exception.  The 2.85% level is arguably better off moving down to 2.837 (let's call it 2.84%) at that lines up much better with bounces seen at the end of last week and so far this week.  Both yesterday in pre-market trading and today after 8:30am, bonds stopped what they were doing when they ran into 2.84, and in both cases, momentum increased after it was broken.

There aren't any overly compelling explanations for the weakness seen so far, and unless yields break below 2.71 or above 2.91, we shouldn't feel too compelled to find any.  In other words the range is still consolidating as bonds wait for more important data.