MBS Day Ahead: Today is The First Push Back. Ask For More Proof

Posted To: MBS Commentary

Today is shaping up to be the first push back against the current selling trend. By current, I mean the sharper, shorter trend of the past 7 days as opposed to the longer-term trends that began in late 2016 and 2012. This current trend is responsible for ending the friendly Springtime consolidation that helped rates stay steady to slightly stronger throughout March and early April. It also happens to have taken yield to new 4-year highs and is within striking distance of 6-year highs. As we discussed yesterday, when selling trends go on for more than 5 days (that's 5 days of yields moving noticeably higher), their respective clocks are ticking. Some--like this one--go on to a 6th day of selling. A few make it to 7 days. 8 day selling sprees are a rarity, and anything more than that is almost...(read more)

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