Meant to post this yesterday
Results of the auction were pretty good with 25 billion priced at 3.47% (no tail), 2.81 bid to cover (2.61 average), and 47.5% going to indirect bidders. Give it a grade of B. Trouble is, the market is feeling a bit of indigestion. The 10 year note was up 6/32’s prior to the auction but is now down 2/32’s. Mortgage backs have cut their gains in half, bringing a worsening price change close to reality. With the bond market closed tomorrow, expecting further gains (rally) is fool’s gold. Be careful out there.