Not the usual correlation
This week's theme has been lower yields and a higher dollar but it started unwinding yesterday and that has continued.
US 10-year yields are now up 7.2 bps to 1.36% today. That's 11 bps above yesterday's lows, which coincided with the 200-day moving average.
We're now testing the post-Fed low, which is now resistance.
Overall, I have go back to early Thursday when I highlighted a note from Wells Fargo that called bulls**t on the bond move. I think market participants desperately tried to fit the macro picture to price action in bonds this week but couldn't get there.
Ultimately, I think that failure will underscore the reversal in both yields and the dollar. It's tough to say that's a high-conviction fall though. It's June and it's tough to feel on balance after what happened this week.
