| Jan 5, 2011 6:16PM Yesterday, we wrote "the release of the ADP Employment Report in the morning could provide some directional guidance because that data tends to be a preview of things to come in the Employment Situation Report (to be released Friday morning at 8:30am)." Today, we've seen what borders on a worst-case-scenario transpire with respect to that data. Jan 5, 2011 4:15PM Supposedly strong JOBS DATA was the culprit behind today's forced liquidation of post 7-year note auction longs and the ultimate retest of 3.50% (profit taking, liquidation, short selling, bid wanted. This price action washes out any potential shift in momentum we had going for us...but it doesn't do much else besides leave sentiment sorta flat. Speculatively the implied strength of ADP report makes us feel like we're doomed for a run at 3.70% in 10s and 5.25% in mortgage rates, then again, speculatively, it seems like the bond market is now set up well to rally on a disappointing NFP print on Friday. Isn't strong jobs data already baked in? Hello! NO REACTION TO A MUCH WEAKER THAN EXPECTED NOVEMBER EMPLOYMENT SITUATION REPORT. I feel like the bond market owes us some leeway here....
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