Afternoon Coffee Break...

Treasury market rallied this morning but is fading a bit now. I think 5.03% on 10's is a significant resistance point. The market tried to break 5.08% today, but failed and is now at 5.10%. I'm still bearish on Treasuries. I'll bet the 10-year prints at 5.20% some time within the next 10 trading days.

10-year Treasury is outperforming the 10-year TIP by 3 ticks at of the moment. The differential is 2 ticks for the 30-year. As was written in the piece about the Inflation Curve, if TIPS underperform Treasuries, the market is saying a Fed pause is near.

Corporates seem well bid. MBS performing in line.