MBS Day Ahead: Shifting Into Holding Pattern Ahead of Week's Bigger Events

Posted To: MBS Commentary

While the broader uptrend in rates remains technically intact, the first trading day of the week pushed back in a friendly direction. In fact, it was a continuation of a 2-day move that technically began with solid gains on Friday, thus inviting the question "is this the big bounce?" Rather than assume this is a reversal of the negative momentum that's been intact since the beginning of September, the safer plan for now is to view it as a consolidation ahead of the bigger decisions . We'll need to hear from Trump on the Fed Chair nomination before becoming too confident in the next wave of momentum. Between now and then, there's not much to be done from a strategic standpoint. We could obsess over this week's economic data--some of which is typically quite relevant...(read more)

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