In the week just passed, bonds set to the task of confirming a ceiling in yields that had been forming at the end of the previous week.  The friendly support put an end to the selling pressure that had been intact since the strong jobs report at the beginning of the month.  European bond market strength and US stock market weakness were both generally supportive.  But there wasn't quite enough momentum in the other direction to identify a new, positive trend.  Bonds generally drifted sideways near the week's best levels on Thursday and Friday.

In the week ahead, we'll have a moderate dose of data and events to digest in what otherwise will be a placeholder ahead of next week's Fed rate cut.  Technically, next Wednesday should be referred to as a meeting or an announcement, but the rate cut is so completely priced-in that it would take a small miracle in this week's data to open the door for other scenarios.  The biggest reports come in on Thursday and Friday with Durable Goods and GDP respectively.

From a technical standpoint, we can ask ourselves if there's another way to look at the current landscape apart from "sideways near long-term lows" after having successfully defended the 2.15% ceiling in 10yr yields.  That's the baseline, and it involves the 3 fairly clear pivot points.

2019-7-22 open

If we change to hourly candlesticks, we can see enough additional detail to pick out an underlying uptrend in yields--one that's been intact since the jobs report at the beginning of the month.  Making it through the yellow line would set us up to take a run at 1.975% by the end of the week.

2019-7-22 open22


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
100-29 : +0-05
Treasuries
10 YR
2.0330 : -0.0170
Pricing as of 7/22/19 8:51AMEST

Tomorrow's Economic Calendar
Time Event Period Forecast Prior
Tuesday, Jul 23
9:00 Monthly Home Price yy (%) May 5.2
10:00 Existing home sales (ml)* Jun 5.33 5.34
10:00 Exist. home sales % chg (%)* Jun -0.4 2.5
13:00 2-Yr Note Auction (bl) 40
Wednesday, Jul 24
7:00 MBA Purchase Index w/e 265.1
7:00 Mortgage Refinance Index w/e 1827.3
10:00 New home sales chg mm (%)* Jun 5.4 -7.8
10:00 New home sales-units mm (ml)* Jun 0.660 0.626
13:00 5-Yr Note Auction (bl)* 41
Thursday, Jul 25
8:30 Nondefense ex-air (%)* Jun 0.2 0.5
8:30 Durable goods (%)* Jun 0.7 -1.3
8:30 Jobless Claims (k) w/e 219 216
13:00 7-Yr Note Auction (bl)* 32
Friday, Jul 26
8:30 GDP Advance (%)* Q2 1.8 3.1