MBS Week Ahead: Decision Time For The Range as Data Ramps Up

Posted To: MBS Commentary

The past 5 business days of bond market rallies brought yields right to the lower edge of 2017's range . We had been tracking these movements in terms of a "consolidation range" (i.e. converging lines connecting higher lows and lower highs) but the most recent strength makes a case for a horizontal lows. Up until Friday, 2017's two major lows were 2.305 and 2.325 in that (ascending) order. Friday brought us as low as 2.309. It also brought short-term momentum metrics into "ov e rbought" territory. While that's never a guarantee of a bounce, it does mean that bonds are more "ready" to bounce–especially in the presence of the proper motivation. Motivation this week could be easy to find, depending on the outcome of the various economic reports and the…(read more)

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Source: Mortgage News Daily

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