Posted To: MBS Commentary
It’s a crappy day. Sorry to use such an esoteric analytical term, but it’s the most accurate way to describe the outlook. So what changed? Long story short, we’d been in a narrow, consolidative range since late September. That range had a chance to be a straight up correction back toward lower rates, but bonds weren’t able to maintain momentum after last Friday’s strong post-CPI rally. Resistance kicked in at a well-traveled technical level of 2.28%, thus setting up the lower boundary of the consolidative range. Until yesterday, we HAD a series of “lower highs” in rates to offset the series of “higher lows.” In short, yields were converging, and it was anyone’s game. This morning, the upper consolidation line (both in teal in the following chart)…(read more)
Via:: MBS Day Ahead: Bonds Back on The Ropes
