Earlier today, competing short term trends and considerations made for several salient swings between gains and losses.  While MBS and Treasuries never dipped meaningfully into negative territory on the day, they quickly gave up some fairly strong gains on at least 2 separate occasions.  On top of that, the overnight session began with a swift move right out of the gate.  Taken together, there was simply a good amount of movement and "lead changes."

Around noon (just after the second bounce off the day's weakest levels), I put an overlay on the Treasury chart showing a potential consolidation into the close.  The trendlines ran through 2.28 on the high end and 2.26 on the low end, which is "the gap" that we've been paying so much attention to this week. 

2014-10-24 db1

This is how things happen sometimes.  Crossing over a significant technical level might end up acting as a major cue for movement, or it can simply be the first step in an orbital consolidation (think of a tether ball getting closer and closer to the pole).  Rather than act as a gateway to the next big move, "the gap" at 2.26-2.28 has been a tether-ball pole for yields. 

This is actually fairly forgivable considering the much more significant fundamental events hitting the tape next week.  These start as early as Sunday with the official results of the European bank stress tests that moved markets a bit this morning.

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
100-11 : +0-01
FNMA 3.5
103-18 : +0-02
FNMA 4.0
106-07 : +0-03
2 YR
0.3860 : -0.0080
10 YR
2.2640 : -0.0130
30 YR
3.0370 : -0.0120
Pricing as of 10/24/14 4:37PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
11:25AM  :  ALERT ISSUED: Negative Reprice Risk Increasing; Bonds Revisit Weakest Levels
9:24AM  :  Bond Markets Hit Troubling Resistance After Overnight Gains

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "I don't think it signals anything at this point. I think "the gap" ended up being where the bond market's collective seats were for the upcoming parade of data and events. Keep in mind, if a trend on a chart is negative or positive, there's usually an opposite trend waiting to be seen by zooming in or out. "
Frank Hanna  :  "MG nice mid day. Would you say that the longer we stay in the range signals something good ior bad? I know your recent chart shows directional weakness for us. "
Jeff Statz  :  "my favorite, "I never needed to provide that on my previous loan" in 2005"