Good Tuesday AM,

The blood bath in the bond market is not subsiding. Bonds continue to search for a bottom and there is no clear indication where that point may be. We do have a number of reliable indicators that will help determine bottom, but none of them are green at this point. Mortgage bonds would need to break above the downward channel before we can call the bottom. The beginning of 2021 has also seen a rapid steepening of the yield curve, as the prospect of a unified Democratic government led investors to reprice expectations for economic stimulus and debt issuance in the wake of the Georgia runoff result. Today there is a record-matching $38 billion auction of 10-year bonds. It will be closely watched. The moves in the Treasury market are raising concerns about the resilience of the market rally, particularly in emerging markets.

Please remain safe and healthy, make today great!