Today exemplifies the week as a whole.  All we can do is buckle up, hope for the best, and not sweat it too much if the rally stalls. 

Reason being: Thanksgiving weeks have a strong predisposition to be more volatile than the rest of November.  With said weeks often falling at the end of the month and with a ton of economic data typically condensed into a day or two earlier in the week, it's not hard to see why.

This week, in particular, is also one of the many that have arrived during a fairly epic sideways slide.  In fact, essentially all of November saw 10yr yields hover in the 2.3's with yesterday being the first meaningful break into the 2.2's.  That leaves us to wonder whether it's just the expected Thanksgiving-week volatility or if the sideways range is finally giving way.

Let me put it this way: if this is just the sideways range finally giving way, it would be a coincidental move that happens to get lucky by falling in line with next week's infinitely more significant data (namely, the ECB Announcement on Thursday).  Even if we do want to say that there is some organic strength behind this breakout or that 'all things being equal, this is the direction bonds want to go,' next week could take things in a completely different direction.

But back to today... where were we?  That's right.  All that' left to do is buckle up.  The ride might not prove to be overly bumpy, but that's a better possibility today than any other day so far this month (thank you, hindsight!). 

On the data front, we have Durable Goods, Jobless Claims, and Personal Consumption expenditures.  And that's just the 8:30am time slot!  The festivities continue apace at 9:45, 10am (twice) and finally at 1130am for the week's last Treasury auction.  Add to that the fact that most accounts will conclude that Friday isn't a safe day to expect a liquid month-end trading environment, and today is also effectively the last day for those compulsory month-end tradeflows. 


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
100-23 : +0-00
FNMA 3.5
103-31 : +0-00
FNMA 4.0
106-21 : +0-01
Treasuries
2 YR
0.5240 : +0.0000
10 YR
2.2550 : -0.0040
30 YR
2.9580 : -0.0060
Pricing as of 11/26/14 7:30AMEST

Tomorrow's Economic Calendar
Time Event Period Forecast Prior
Wednesday, Nov 26
7:00 Mortgage Market Index w/e 391.3
8:30 Consumption, adjusted mm (%)* Oct 0.3 -0.2
8:30 Personal income mm (%) Oct 0.4 0.2
8:30 PCE price index mm (%)* Oct 0.1
8:30 Durable goods (%)* Oct -0.6 -1.1
8:30 Initial Jobless Claims (k)* w/e 288 291
9:45 Chicago PMI * Nov 63.0 66.2
10:00 New home sales-units mm (ml)* Oct 0.472 0.467
10:00 Pending sales change mm (%) Oct 0.5 0.3
11:30 7-Yr Note Auction (bl)* 29