As we enter 2020, treasuries, including the lead bond, the 10-year note is up 11 ticks at 128.25. Stocks opened higher as well as the S&P 500 hit a high of 3251.75 but failed to take out the contract high at 3254 which was hit on Dec 27. My belief is that treasuries will find good bids early in the first quarter on continued uncertainty with trade issues from China. Just because “Phase One” will be signed and delivered, there will still be obstacles going forward as China is very reluctant to budge on futures demands from the U.S.  

Economic news around the globe overnight was somewhat strong as many countries reported decent PMI numbers and, in the U.S., we saw the Markit PMI come in a tad weaker. Looking at technicals in the 10-year note, 12829 is the 40-day moving average and 129-02 is the 50-day moving average. If the note clears those levels on a closing basis, look for the market to attack the 100-day moving average at 129-31. The remainder of the week in terms of the economic news is light with the highlight next week comes the monthly employment number which comes out next Friday.