Posted To: MBS Commentary
Sure, we’ve ‘endured’ the rigors of a day-to-day ups and downs in bond markets over the past month, but if we step back from the charts by more than a few inches, we’re left with nothing but “sideways.” Friday was the most recent attempt to break below this sideways range, and the fact that 10yr yields bounced at 1.48 before ending the day over 1.50 should have been our first clue (in fact, it was a clue we discussed at the end of last week). The conclusion is that the range is the range until it’s not the range any more. In fact, even the movement that seems like it might mean something is actually happening in an extremely linear and mechanical way. Take the 2-day trend in either MBS or Treasuries as an example. There was very little volume or liquidity in today’s…(read more )