Thursday, July 28, 2016

MBS Day Ahead: Momentum Should Be in Our Favor, But Challenges Remain

Posted To: MBS Commentary

One tricky thing about technical analysis (things like moving averages and other mathematical formulas applied to charts in order to get them to cough up more information about where they might be going) is that the relevance of any given technical can vary greatly depending on the circumstances. For instance, if bonds have are in a sideways trend for a few weeks, and had been trending directionally in the few weeks before that, the current sideways trend will result in many technicals suggesting that momentum is heading in the opposite direction from the trend seen in the first 2 weeks. Put more simply, Imagine it's July 28th and that bonds have been in a sideways range between 1.52 and 1.62 for the last 2 weeks. Then imagine they'd risen from 1.32 to 1.52 in the 2 weeks before that...(read more)
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from Mortgage News Daily http://ift.tt/2acikRw

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