MBS Commentary

MBS Commentaryhttp://www.mortgagenewsdaily.com/mortgage_rates/blog/Mortgage Rates BlogenCommunityServer 2008 SP2 (Build: 31106.96)The Day Ahead: MBS in Full Melt-Down Mode. What Next?http://www.mortgagenewsdaily.com/mortgage_rates/blog/309882.aspxThu, 23 May 2013 10:58:00 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309882Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309882http://www.mortgagenewsdaily.com/mortgage_rates/blog/309882.aspx#comments<p>The idea of "tapering" the Fed's long term asset purchases<strong> isn't as new </strong>as the past two weeks might make it seem.  It was most visibly introduced in early February when both <a href="http://www.reuters.com/article/2013/02/01/us-usa-fed-bullard-idUSBRE9100VD20130201" target="_blank">Bullard</a>and <a href="http://www.reuters.com/article/2013/02/04/usa-fed-fisher-idUSL1N0B48FW20130204" target="_blank">Fisher</a> spoke out in favor of the notion.  But a quick count of all Reuters newswires in which the word has appeared since then shows that it really exploded on April 10th after the last FOMC Minutes release.  Suddenly, "tapering" was the <strong>talk of the town</strong> and was strangely soothing to bond bulls fearing a more abrupt exit and strangely emboldening to Fed Hawks, seen as proponents of immediate tapering.</p> <p>Then a month of<strong> relative excellence</strong> for bond markets caused amnesia on tapering topics and the new FOMC Announcement on 5/1 even left the door open INCREASED asset purchases.  In the midst of a raft of mostly negative economic data and the prospect that 5/3's NFP would confirm it all, bond markets were out to maximum-distance lead off, testing the validity of longer term trends.  All it took was the catastrophically positive Jobs report, and headlines like this were mere hours away:</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309882.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309882/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309882" width="1" height="1">MBS Annihilated After Fed Confirms The Hypehttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309825.aspxThu, 23 May 2013 00:11:03 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309825Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309825http://www.mortgagenewsdaily.com/mortgage_rates/blog/309825.aspx#comments<p>Today was among the worst on record for MBS since the carnage that was late 2010.  We still have yet to see anything rival Black Wednesday's, but almost exactly 4 years after that 2+ point evisceration (5/27/2009), today's loss of just over a point--in the midst of what was already an unpleasant downtrend--conjured up the same sort of gut-wrenching feelings.  At least in the current case, there's some measure of logic involved, not to mention much more advanced notice.  It might not prove to be the 4-month game changer that Black Wednesday was, but the problem is that it could be part of confirming that an already possible game-change is in progress--that being the ongoing long-term uptrend in rates that began after Treasuries hit all-time lows in mid 2012.  It's been a bumpy road for sure, but one that's characterized so far by "higher lows" in terms of yields.  If you're looking for more explanation specific to today's trauma, the highlighted section below could be helpful.</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309825.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309825/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309825" width="1" height="1">mbsonmndMBS MID-DAY: THIS IS WHY YOU WANT MBS LIVE!http://www.mortgagenewsdaily.com/mortgage_rates/blog/309762.aspxWed, 22 May 2013 16:41:00 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309762Matthew Graham1http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309762http://www.mortgagenewsdaily.com/mortgage_rates/blog/309762.aspx#comments<p>If you read this commentary with any sort of frequency, you may have noticed a trend of late, where the mid-day recap has been coming out later than normal.  As we've said, this happens when MBS have sold off sufficiently, and early enough in the day to create negative reprice risk before the time the mid-day commentary is automatically collated in our system.  Unfortunately for bond prices, that's happened quite a lot lately.  During these times, I'm writing reprice alerts for <a href="http://www.mortgagenewsdaily.com/mbslive/">MBS Live</a> and interacting in real time with the other members of the MBS Live community on the dashboard.  The first reprice alert today was out at 10:39am, well in advance of any lender reprice, and I've written two additional updates/alerts since then.  Even before the alert, the <a href="http://www.linkedin.com/company/mbs-live-/mbs-live-dashboard-512212/product">MBS Live Dashboard</a> lit up like the 4th of July (but mostly with red fireworks), and the live chat was buzzing with reactions to the sell-off.  I don't make it a habit to plug our paid service too much in the stuff that I write, but today is one of the days where it would be inexcusable for me not to do so considering the timeliness of the pricing and alerts, and if I might be so bold, the quality of the content.  The past few weeks have been rough for prices, and unpleasant for many of our members, but they've also enjoyed unparalleled warning on reprices and indeed been able to witness to catastrophes in real time every day.  In short, I'm sorry the recaps have been occasionally delayed, but I've been needed on <a href="http://www.mortgagenewsdaily.com/mbslive/">MBS Live</a>, and that's where you should be if the timeliness of the content is even remotely important to you.  </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309762.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309762/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309762" width="1" height="1">The Day Ahead: Has All the Hype Been Remotely Justified?http://www.mortgagenewsdaily.com/mortgage_rates/blog/309665.aspxWed, 22 May 2013 11:23:00 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309665Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309665http://www.mortgagenewsdaily.com/mortgage_rates/blog/309665.aspx#comments<p> </p> <p>Wednesday May 21st, and we finally get to see <strong>what all the fuss is supposedly about</strong>.  The "fuss" or hype, if you prefer, was theoretically kicked into high gear by a somewhat <strong>bungled</strong>pre-release '<strong>leak</strong>' of a Hilsenrath story about the Fed 'mapping an exit strategy.'  Bond markets started selling off around the same time, but the extent to which this had much to do with the announcement of the impending Hilsenrath article is still a matter of debate. </p> <p>Reason being: it coincided with <strong>two or three other contenders </strong>that would have also been sufficient to engender such a spike.  Well before any of the drama began, we'd discussed our own 'mapping' <a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/308084.aspx">HERE</a>, highlighting the risks that the May selling trend would continue and pointing out the technical ledge at 1.83-ish in 10yr yields as being a massively important inflection point (see the <a href="http://www.mortgagenewsdaily.com/cfs-file.ashx/__key/CommunityServer.Blogs.Components.WeblogFiles/jann/2013_2D00_05_2D00_09-TSY-1.gif">CHART </a>at the bottom of that <a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/308084.aspx">page</a>). </p> <p> </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309665.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309665/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309665" width="1" height="1">MBS RECAP: Big Bounce Higher Ahead of Fedhttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309613.aspxTue, 21 May 2013 20:28:39 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309613Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309613http://www.mortgagenewsdaily.com/mortgage_rates/blog/309613.aspx#comments<p>In sort of an inverted reading of the recent script, bond markets weakened right out of the gate and began improving at 10am (several notable occasions in May have seen the opposite).  From there, they kept on improving until hitting highs of the day at 2pm.  For MBS it was a 20 tick swing all told, and Fannie 3.0s still hold 19 of those ticks (roughly a .625 move from lows to highs) but compared to yesterday's latest levels, only added about .375.  Combine that with the fact that yesterday's latest levels were the worst of the day and it leaves today's highs right in line with yesterday's.  Lenders passed on only token improvements in pricing ahead of more potential volatility tomorrow.  Markets are eager to hear what Bernanke has to say in the morning when he testifies before the Joint Economic Committee.  Any clues here could set the tone for the approach to the FOMC Minutes at 2pm in the afternoon.  There's been a lot of build up to tomorrow and the possibilities are big in either direction.  </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309613.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309613/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309613" width="1" height="1">mbsonmndMBS MID-DAY: Bond Markets Rallying. Wait... What?http://www.mortgagenewsdaily.com/mortgage_rates/blog/309549.aspxTue, 21 May 2013 16:10:44 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309549Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309549http://www.mortgagenewsdaily.com/mortgage_rates/blog/309549.aspx#comments<p>Like a jilted lover learning how to trust again, MBS were tentative at first, and Treasuries hesitated at 1.97 as they descended from morning weakness, but both have rallied directionally since then.  The possibility and/or hope is that the highest yields and lowest prices this morning, constituted some sort of final push to the furthest reaches of the pre-FOMC range.  Big volume came into Treasuries 7 minutes before Fed's Bullard's speech in Frankfurt.  Either the clocks in Germany are running 7 minutes fast or dealers saw inventory getting lighter after the Fed's buying operation in 7-10yr maturities.  Supply/Demand imbalances can often have an effect on Treasuries during and after the Fed's scheduled Treasury buying from 10:15-11:00am.  Whatever the case, Bullard's comments certainly didn't hurt, as they were more dovish than usual.  Even though he was making a case for European central bank policies, his comments were essentially endorsing current policy in the US, saying the QE is the best approach when rates are near zero.  Fannie 3.0s are now back to a very important technical zone at 102-16 as 10yr TSYs fall to mid 1.95's.</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309549.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309549/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309549" width="1" height="1">The Day Ahead: Recent Volatility Might be Logicalhttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309468.aspxTue, 21 May 2013 10:12:00 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309468Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309468http://www.mortgagenewsdaily.com/mortgage_rates/blog/309468.aspx#comments<p> </p> <p>There continues to be little to do or say about the first two days of the week.  For the most part, they merely serve as a sort of cruel waiting game (or torture rack)  ahead of Wednesday's FOMC events.  Those events include the Bernanke testimony to the Joint Economic Committee in the morning and of course the hotly anticipated FOMC Minutes at 2pm in the afternoon.    </p> <p>In fact, ever since the Employment report on 5/3 set a negative trend adrift, there hasn't been one singular big-ticket event on the calendar that to inform or change the drift.  The biggest swings have been tradeflow related, and we now find ourselves surprisingly in line with the original post-NFP trends from earlier in the month:</p> <p> </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309468.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309468/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309468" width="1" height="1">MBS RECAP: Another Hopeful Morning Dashed by Defensive Realityhttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309417.aspxMon, 20 May 2013 20:44:10 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309417Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309417http://www.mortgagenewsdaily.com/mortgage_rates/blog/309417.aspx#comments<p>Bond markets got in this morning and quickly began undoing some of the damage done by the overnight trading session.  Treasuries and MBS both opened flat to slightly stronger and made further gains in the first few hours.  This was soon revealed to be the same old set-up we've seen  play out frequently since May 3rd.  It usually ends with things starting to get slippery after 10am and drifting sideways-to-weaker in the afternoon.  Today was no exception.  10yr yields ran into a floor that had been paved over on Friday after the Consumer Sentiment data.  Before that, it had been a ceiling, providing a good bounce before the Friday afternoon drift took over.  After bouncing there today, it was all over for 10's and MBS alike.  The former moved quickly from 1.92 to 1.975 and MBS dropped from 102-24 in Fannie 3.0s to 102-10 over the same time period.  Both drifted sideways since then and are heading out the door near their lows of the day.  Tomorrow's a toss-up, being the last day before Wednesday's potentially enlightening FOMC Minutes.  There's temptation to think (or 'hope') that we've seen enough selling to stabilize, but technicals leave room for one additional push into weaker territory before Wed's main event.</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309417.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309417/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309417" width="1" height="1">mbsonmndMBS MID-DAY: Morning Gains Give Way to Mid-Day Rout (again)http://www.mortgagenewsdaily.com/mortgage_rates/blog/309361.aspxMon, 20 May 2013 16:36:02 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309361Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309361http://www.mortgagenewsdaily.com/mortgage_rates/blog/309361.aspx#comments<p>Please note the timestamp on the pricing snapshot below, and that it's about an hour and 15 minutes old.  The snapshot will continue to be generated between 11:00-11:10am while the MID-DAY Commentary time may vary depending on market volatility.  Lately, MBS have had an unfortunate tendency to reverse course after making gains (or at least holding ground) in the first two hours of the day.  When this occurs, our resources are fully allocated to reprice alerts for the<a href="http://www.mortgagenewsdaily.com/mbslive/"> MBS Live community</a>.  One of those is already reflected in this recap, but there were two additional instances at 11:33am and 12:12pm.  Those operational details tell about as much of the story as there is to tell for bond markets this morning.  There hasn't been any data, headlines, or events to fuel the volatility.  Tradeflows and pre-FOMC positioning have been dominant, and MBS are not too happy about it this morning.  The biggest pop of selling arrived heading into the 11:00am hour.  That took prices to the levels seen below.  Around 11:30, we moved down another 3-4 ticks in Fannie 3.0s and are currently holding there.  Most every lender has repriced for the worse, beginning at 11:27am.</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309361.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309361/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309361" width="1" height="1">The Week Ahead: No Scheduled Data Before Wednesday's Important FOMC Minuteshttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309274.aspxMon, 20 May 2013 11:53:00 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309274Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309274http://www.mortgagenewsdaily.com/mortgage_rates/blog/309274.aspx#comments<p> </p> <p>Whether or not it turns out to be justified, <strong>hype </strong>and <strong>anticipation </strong>have been building over this week's <strong>FOMC Minutes</strong> for over a week now.  The hype concerns the notion that the Fed Minutes will show a Fed board that is somewhat closer to <strong>tapering </strong>QE3 than the current market consensus might suggest.  Recent Fed speakers, though not all of them, have added to the hype by suggesting tapering could begin this summer.  Some of them have rested their hats on the verisimilitude of a housing recovery, saying it makes more sense to pull back on<strong>MBS first if housing is heating up</strong>.  </p> <p>The other side of last week's coin and of the hyper in general, is the possibility that the Minutes show broader consensus that things are as they should be--that is to say the FOMC is "<strong>staying the course" on QE</strong> and needs to see "more" before scaling back on bond buying programs.  There really hasn't been much reason to doubt this would be the case, but a few seeds of fear have been planted, and now even the skeptics must wait for Wednesday, just in case they're wrong.</p> <p> </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309274.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309274/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309274" width="1" height="1">MBS RECAP: Reminded of Volatility via Friday Cliff-Divinghttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309212.aspxFri, 17 May 2013 20:46:57 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309212Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309212http://www.mortgagenewsdaily.com/mortgage_rates/blog/309212.aspx#comments<p>MBS took a running start downhill this morning before reaching the edge of the cliff marked by yesterday morning's "ledge" of prices.  This was the 102-28 area hit after yesterday's 8:30am economic data, including the weaker-than-expected Jobless Claims figures.  MBS would go on to rally further after Philly Fed data at 10am, resulting in their best day of the month by a wide margin.  Staring over the precipice of that same cliff (OK, it's not a very epic sort of cliff by the time we get back down to 102-28 from yesterday's highs at 103-10, but we're going for some continuity with the title here!), MBS turned, mouthed the words "it was never about the data..." and took the leap, ultimately making a splash (lots of them) around the important 102-16 waterline.  What was all that about the data though?  Surely, we improved yesterday because of weak data and lost ground today due to strong Consumer Sentiment, right?  Not exactly.  The data points over the past two days, in our view, have served the role of "hide-behinds" for trading levels to carve out a range from which to approach next week's watershed FOMC Minutes.  Will it be one-tenth as eventful as the hype seems to suggest?  All we know for now is that markets are sure trading it that way, or maybe the Minutes are a "hide-behind" too!</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309212.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309212/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309212" width="1" height="1">mbsonmndMBS MID-DAY: Third Time is NOT the Charm for Bond Marketshttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309158.aspxFri, 17 May 2013 16:51:57 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309158Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309158http://www.mortgagenewsdaily.com/mortgage_rates/blog/309158.aspx#comments<p>Here we are again...  All but a few days this week have seen morning sell-offs that have required negative reprice alerts for<a href="http://www.mortgagenewsdaily.com/mbslive/"> MBS Live subscribers</a>.  As previously intimated, such alerts delay the publication of these free recaps and will be reflected in the afternoon recap.  It also means that the price table below is quite a bit out-dated at the moment, as it is automatically generated for this morning recap between 11:00am and 11:10am.  Prices are quite a bit lower now and I've posted two more alerts since then.  Consumer Sentiment wasn't the only culprit here.  Rather, the pre-FOMC "<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309072.aspx">range-finding</a>" is probably what accelerated the losses with the Sentiment data merely serving to reinforce yesterday's highs.  We've been trending back in the other direction ever since, and in a surprisingly linear fashion.  In one manner of thinking, Consumer Sentiment "fit inside" that preexisting trend, but definitely reinforced it.</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309158.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309158/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309158" width="1" height="1">The Day Ahead: Winding Down and Range Finding; 2 Cool Chartshttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309072.aspxFri, 17 May 2013 11:53:00 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309072Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309072http://www.mortgagenewsdaily.com/mortgage_rates/blog/309072.aspx#comments<p> </p> <p>The bulk of the week's activity has passed, from a calendar standpoint, and this morning's Consumer Sentiment data is all that's left on the domestic agenda.  Even in the overnight session, there are no interesting data sets, and really, no data period, unless you consider Canadian CPI interesting (and we'd recommend against such perversion).  </p> <p>These days tend to go one of two ways.  More often than not, after big sell-offs and moderate bounces like we've seen this week, these Friday's fizzle mostly sideways as long as the data doesn't get any snowballs rolling.  Occasionally, however, Sentiment data, and even other headlines can do just that.  So I guess that's Fizzle with a chance of snowballs?</p> <p>Here are a few charts to help frame the trading day ahead.  First up, take a look at MBS. </p> <p> </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309072.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309072/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309072" width="1" height="1">MBS RECAP: Purposeful Rally Helps Define Pre-FOMC Rangehttp://www.mortgagenewsdaily.com/mortgage_rates/blog/309018.aspxThu, 16 May 2013 20:47:37 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:309018Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=309018http://www.mortgagenewsdaily.com/mortgage_rates/blog/309018.aspx#comments<p>Yesterday and again early this morning (before the data), we discussed the potential significance of yesterday's prices failing to make a new low for the first time in 9 days.  It's not a common thing for MBS or Treasuries to go that many sessions in a row making new lows, and earlier in the week we noted that sell-off's in Treasuries seldom go more than 8-12 sessions without pausing for at least 2 days.  The current sell-off hit it's 9th day yesterday, and the strong bounce at the same highs (yield) seen on Tuesday set the stage for 1.98 to be the high end of the near-term range heading into next Wednesday.  The analogous level for MBS would be 102-16.  After dipping for a moment to 102-17 this morning, MBS never looked back, though they did lose a little bit of their sparkle late in the day, gaining just over 3/8ths of a point vs the 5/8ths achieved at 3pm.  </p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/309018.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/309018/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=309018" width="1" height="1">mbsonmndMBS MID-DAY: Bounce Back/Rally Gains Tractionhttp://www.mortgagenewsdaily.com/mortgage_rates/blog/308955.aspxThu, 16 May 2013 15:50:35 GMT2bb7a989-b681-446d-a7f2-bd5f0562f228:308955Matthew Graham0http://www.mortgagenewsdaily.com/channels/mortgage_rates/rsscomments.aspx?PostID=308955http://www.mortgagenewsdaily.com/mortgage_rates/blog/308955.aspx#comments<p>Hopefully, in talking about the half point rally in MBS we're not unintentionally "jinxing" it, but yeah--there's a half point rally underway in MBS.  This all started out innocently enough as bond markets walked in domestic doors roughly level with yesterday's closing prices.  Those prices were roughly mid-point on the day yesterday.  That was an important place to be this morning considering yesterday's lows were the first in 9 sessions to NOT fall below the previous sessions lows.  That meant that any ground-holding or improvement today would help confirm the case for a medium term range boundary being hit on Tuesday and Wednesday.  We've held above those lows and then some, thanks to another round of economic data that has been universally bond-market-bullish.  Claims, Housing Starts, Philly Fed...  All weaker.  Inflation: still not a factor.  MBS moved up from unchanged right to yesterday's highs after the first round of data and had doubled those gains by the time Philly Fed was digested.  10yr yields are treating 1.88 as a CEILING at the moment.  The longer that continues to be the case, the more traction the broader 3-day bounce gains.</p>...(<a href="http://www.mortgagenewsdaily.com/mortgage_rates/blog/308955.aspx">read more</a>)<p><div style="background-color:#D4EDC9;border:1px solid #BDD4B3;padding:3px 5px 3px 6px; color:#000000;font-family:arial,sans-serif;font-size:12px;"><strong>Forward this article via email:</strong>  <a href="http://www.mortgagenewsdaily.com/channels/308955/3/forward.aspx" style="color:#3333CC;">Send a copy of this story</a> to someone you know that may want to read it.</div></p><img src="http://www.mortgagenewsdaily.com/aggbug.aspx?PostID=308955" width="1" height="1">mbsonmnd