Bonds are starting out the new week just barely below the mid-point of last week’s big, volatile trading range. Getting here required a moderate amount of overnight weakness, which was gladly provided by steady losses in European bonds yesterday (while US bonds were closed). Trading has been sideways and slightly choppy so far this morning.
In the bigger picture, the gradual uptrend that began on May 31st continues to offer resistance to rally attempts. If that trend is broken, the most obvious rally target would be 3.17% in terms of 10yr yields. Bond bulls want to see continued support at 3.31, but ultimately, yields could revisit 3.50% without breaking the “sideways volatile” range.