Monday is Columbus day and a bank holiday, although bond markets are closed, some lock desks will be open, but the calendar is silent. It effectively remains silent on Tuesday morning, but the week kicks off at 1pm with the 3yr note auction.

In the remaining days of the week, we'll get two more auctions, FOMC minutes, and a increasingly busy economic calendar that includes the Trade Balance, Jobless Claims, Retail Sales, Import/Export Prices, Consumer Sentiment, and Business Inventories.

Perhaps most importantly will be next week's role in the confirmation or rejection of the technical trends that were broken with today's trading action. That's discussed in greater detail in the following link:

The move down is still young, so if you're on the mobile version, check levels in case it proves to be short-lived, but we wanted to get an alert out quickly because of the sharpness of the recent downtick, and the fact that it brings MBS in line with the lowest lows of the day.

- Fannie 3.5's hit 101-10 (down 25 ticks on the day)
- 10yr yields are up to 2.08 (9 bps on the day)
- S&Ps are back near their morning highs at 1166 currently
A lender or two might not be content to see this late day, illiquid weakness for what it is, and we can't rule out a reprice for the worse, although we'd hope that wouldn't be widespread or severe. Still, it's a risk of which to be aware.

This is a heavily conditioned reprice alert. The chances of a reprice for the better here are fairly unknown but probably depend on the following:

1. How long MBS are able to hold or improve upon current levels
2. How weak pricing was this morning at the lender in question.
3. How conservative the lender wants to be going into the long weekend.

Fannie 3.5's are currently in line with the fabled "concrete ceiling" levels at 101-25. Stocks have been selling and Treasury yields coming down just slightly.

The S&P is down almost 20 points from it's highs to 1153.41 and the 10yr yield is 2.065 currently after earlier hitting 2.12 on two occasions.