The week’s largest trading range was 4.5 basis points (Tuesday), but tomorrow’s job report could easily result in twice as much movement or even three times as much. Based on the relevant technical levels, this means that bonds are closed in as neutral a position as possible (1.30% in 10-year yields leave an equal gap between the upper and lower end of the 4-week range). With this level already marking the closing price for yesterday, traders didn’t have to do much today – a fact that can be seen in the smallest trading range and lowest volume profile of the week.

  • Fed MBS purchases 10 a.m., 11:30 a.m., 1 p.m.

  • Unemployment claims 340k vs 345k f’cast, 354k prev

8:44 am

Flat in Asia, then stronger in Europe, led by European bonds. No major response to AM data. 10 years down 1bp at 1.29% and MBS up 1 tick.

1:25 p.m.

Modest weakness at 10am with short term returns of 1.30%. Since then to a little stronger since then. Lower volume and lower volatility compared to yesterday. MBS was up 1 tick (0.03) at 101-11 (101.34).

3:01 pm

Bonds broke sideways sentiment at 3 p.m., which was slightly intact. The levels have not changed since the last update.