After experiencing losses early in the session,  MBS, Treasuries, and stocks all consolidated into narrowing ranges--this is illustrated via more of those "triangles" we've been discussing which presage volatility.  Unfortunately the breakout that would expected to occur after said consolidations has been unfriendly for mortgages. Fannie 4.0 MBS have inched down to 99-06 from a previous range low of 99-09.

Here are 3 charts showing the breakouts:

On the less gloomy side, downside implications are mitigated somewhat by the fact that trading volumes are very low and liquidity is greatly lacking. Fast$ day traders are indeed driving directionality. Thus we do not tie these breakouts to a big picture perspective.  Additionally, lenders were pretty vicious with rate sheets this morning so while reprices for the worse are possible, they aren't necessary.

Bottom line, reprices for the worse are possible...  There's a chance we haven't moved quite enough in light of the already heavy handed rate sheet reductions this morning, but we're close enough to wonder.