It is NFP Friday in markets and that tends to steal the focus more often than not. While the spotlight is shining on the jobs data, it may well take a backseat in the aftermath before the weekend comes along. That is because the enigma in markets this week is the strong bid in Treasuries.

US Treasury 10-year yields (%) daily chart

It is difficult to find an exact reason for that at this point. One can argue about a technical break below the 200-day moving average (green line) after a top at around 4.19% in yields. Adding to that is a break back under the 4% mark as well this week.

Or perhaps banking worries are creeping in once again, as Adam highlighted here yesterday.

Either way, it is best to take notice of that just in case as something looks to be awry. After all, there is that old saying that the bond market is always right.

In making things more complicated, equities ripped higher in a strong rebound yesterday and that is continuing today as well. S&P 500 futures are up another 0.5% with Nasdaq futures up 1.0% as we look towards European trading.

As for the dollar, that is making it tough to read all of the concurrent developments. There seems to be mixed signals even after the Fed made it clear that March is not the base case for rate cuts.

In that lieu, the non-farm payrolls today will act as the first litmus test for the narrative that the Fed is trying to sell. Will it make good on Powell's pushback this week?

In any case, the data reaction will certainly add to the intricacies in the market action this week.