Bond markets have done a reasonably good job of not losing any more ground following the FOMC Announcement. While it brought a solid amount of trading activity into the market relative to most of today, it remains completely dwarfed by the impact of this morning's GDP 'beat.'
10yr yields got supportive in the 2.56% zone that we suggested 2 alerts ago. This simply looked like the first major inflection point for any large sell-off today. In other words, as far as "big, bad moves" go, this one was fairly logical so far.
Keep in mind that pit trading in Treasury futures closes at 3pm. Bond markets can be less liquid for the next 2 hours (which we refer to as 'after hours'). This occasionally results in choppier movement. All that to say, we're not out of the woods completely. Holding sideways here is good for today if it stops the bleeding, but is also a logical place to rest if bond markets plan on marching higher in yield.
MBS have held up slightly better than Treasuries today, and have also held their ground since 1pm. Fannie 3.5s are now down "only" 19 ticks (it was as much as 23 ticks earlier, or .71875). Despite the ground-holding, we've lost so much ground today that some lenders could still have lingering negative reprices to get out. Of course risks could also increase again if bonds slide in 'after hours' trading.