What Happened
- A strong 2-year Treasury auction pulled yields lower.
- Equities traded sideways as traders positioned for the Fed.
- The dollar softened and gold caught a bid.
- Credit spreads were unchanged.
What It Means
- Auction demand shows investors are comfortable holding duration into the meeting.
- A softer dollar provides mild support for risk assets.
- Sideways equities reflect cautious positioning rather than fear.
What I Think
- I am keeping risk light and focused on quality exposures.
- If the Fed surprises hawkish, duration will reprice quickly.
- Until then, the tape likely stays range-bound.
Market Terms
- Duration bid - Strong demand for longer-dated bonds.
- Auction strength - High demand that lowers yields.
- Range-bound - Trading within a tight band.