It’s hard to appreciate just how different the trading session was for stocks compared to bonds.  To be sure, a near 5bp drop in 10yr yields is “nice,” but it pales in comparison to the amount of movement suggest by or seen in equities markets.  In the following chart, S&P futures daily candlesticks are on the bottom while 10yr yields are on the top.

The afternoon brought an exceptionally strong 30yr bond auction.  Rates responded positively, but seemed to be intent on remaining above the 2.21% technical level in 10yr yields.  It wasn’t until stocks really took a nosedive in the late afternoon that bonds grudgingly trickled down below 2.20% before bouncing back above to end the session.

All eyes remain on tomorrow’s CPI data when it comes to confirming or rejecting today’s preliminary break outside the recent range (note: given that the break didn’t happen until after the 3pm CME close, some technicians wouldn’t officially see today as a break, but it doesn’t really matter.  Bonds rallied, and CPI needs to be weak if they’re going to rally some more tomorrow.  Either that or stocks need to put in a repeat performance).