If you'd like to reduce this week's activity to a very basic concept and seek to explain just about everything we've seen in the past week as a function of that concept, that's probably just fine.

It's not a new concept either, but one of the fairly consistent ideas we discuss of prices/yields 'orbiting' around certain key technical levels.  Of course MBS aren't following Treasuries in perfect lock-step, but the broader momentum in "rates" tends is what we're interested in here.  In that regard, 10yr yield technical levels will tell us more than MBS, while we keep an eye on the latter specifically for intraday reprice risk.

So what's up with 10yr yields?  In short, they've been orbiting around this central source of gravity around 2.72%.  Last week's FOMC events pushed yields quickly higher past that central point, and gravity kicked in to bring them back down to earth. 

Of course when that happens, it's not the only trading motivation in play, so if traders betting on higher rates get caught offsides, or if month/quarter-end buying happens to be high, then we blow right past that gravitational midpoint and end up down in the mid 2.6's as we did yesterday. 

Today, then, brings the week to a logical close with yields moving nonchalantly back to 2.72--a perfectly neutral stance from which to approach next week's Payrolls data, among other things.

2014-3-28 Treasury range

All that to say, bond markets were weaker today after 6 straight days of "not being weaker," and that's OK.  The longer term trend is this consolidative pattern around 2.72.  It's not unreasonable to expect a bigger attempt to escape the clutches of this gravitational pull with next week's more important round of data.

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
96-17 : -0-06
FNMA 3.5
100-20 : -0-07
FNMA 4.0
103-31 : -0-06
2 YR
0.4535 : +0.0035
10 YR
2.7208 : +0.0488
30 YR
3.5473 : +0.0383
Pricing as of 3/28/14 4:53PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:59PM  :  Off the Lows, But No Stampede Back Toward Stronger Levels
11:21AM  :  ALERT ISSUED: Negative Reprices Increasingly Likely
10:55AM  :  ALERT ISSUED: Bonds on Back Foot Yet Again; Reprice Risk Remains
10:24AM  :  Holding Ground Without Further Losses For Now
10:07AM  :  ALERT ISSUED: Bond Markets Weaker Despite Consumer Sentiment Miss; Reprice Risk Increasing
8:57AM  :  MBS Holding Near Unchanged Despite Slightly Weaker Treasuries Overnight

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Adam Dahill  :  "Hey guys stupid question, I don't do a lot of attached PUDS but underwriter is asking for a PUD questionnaire? Wouldn't they just use the appraisal? Never seen a PUD questionnaire before"
Timothy Baron  :  "Yeah it's only like five questions usually. I've never had one cause an issue."
Timothy Baron  :  "Well, maybe more than five, but still not a big deal. Here's an example : http://mndne.ws/1hizbjR"
Hugh W. Page  :  "Yep, need the questionnaire and sometimes (depends on investor) the HOA needs liability insurance on common areas."
Hugh W. Page  :  "Be careful isn't borrower paid MI part of the 3% pts and fees cap? At 95% LTV that's going to eat up most of that 3% isn't it? Or am I wrong?"
Ted Rood  :  "borrower paid is, but if you do lender paid and cover it out of the pricing (rather than borrower paid, showing a lender credit) it doesn't count."
Andy Pada, Jr.  :  "who is locking in?"
Matt Hodges  :  "play defense next week"
Brent Borcherding  :  "I believe we'll see selling into NFP on Friday, I personally think pricing is the best it will be until at least Friday."
Hugh W. Page  :  "We've been in a downward price channel for about a month now and we're bumping up on the upper bound of that channel. I would think seriously about protecting what we have right now. "
Matt Hodges  :  "brent nailed it. i'd be very cautious with advice to clients leading up to 4/4"
Andy Pada, Jr.  :  "my only hesitation of locking today is that Monday is the last day of the month."