It may have been a shortened holiday week, but Wall Street didn’t check out early for vacation.

The stock market remained buoyant  on the positive news of a nuclear deal struck with Iran in return for looser sanctions, and the market climbed higher  after a good read on consumer confidence and a decline in jobless claims pointed toward a potentially stronger holiday shopping season than anticipated.

The rate on the 10-year Treasury note stands at 2.72%, down from last week’s high of 2.84% that was reached shortly after the Federal Reserve’s meeting minutes (which indicated quantitative easing tapering could begin soon) were released. The Fed has the ability to keep short-term rates low, which it will likely do for several years, but cannot fully control long-term rates.

In fact, despite the central bank’s massive buying of long-term Treasuries, the 10-year yield is still up significantly from 1.84% at the start of 2012.

Why spend so much time talking about rate movements?

It’s because over the next several months, the key to where the market will go is likely to be the amount of change in the 10-year yield. Some analysts have suggested that the bond market has already begun to discount the tapering of QE, and that could well be true.

However, it will be interesting to see how bonds react as the taper becomes more of a reality. This week’s release of the November employment report could give us a hint as to just how close we may be to a taper.

Until then, I believe investors will remain cautious in their trading.