The Smart Team of NOVA® Home Loans

MBS RECAP: Q2 Begins With Big, Green, Mystery Rally

Posted To: MBS Commentary

From an analytical standpoint, today's trading session was not well-behaved or easy to assess (I saw several iterations of "no one has any idea what happened today" around analysts' campfires). Bonds began the day in relatively unchanged territory after experiencing essentially no overnight volatility or drama. The opening hours were calm. What's especially striking about that is the absence of volatility surrounding the 8:20am CME open. Reason being: I'd typically want to see some 8:20am volatility in order to make the conclusion that "new month" tradeflows are driving a rally or sell-off. To understand "new month" tradeflows, first consider the month-end bond market environment. By the end of the month a certain portion of bond traders MUST be…(read more)

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Source: Mortgage News Daily

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