Ceiling Signs or Is It a Trap?

Bonds began the day in weaker territory with extra selling signals following the uptick in PCE Prices (inside the Q4 GDP data).  But buyers surfaced early for reasons that subtle and debatable (more discussion on those in today's video).  Sorting out market movers is of distant secondary importance to the bigger picture right now.  Specifically, today would be the first day where one could legitimately make a case for signs of a ceiling taking shape after a fairly rotten February. Cue Admiral Akbar.  Even he turns out to be wrong, it's never a bad idea to consider whether or not "it's a trap!"

Econ Data / Events
    • Jobless Claims
      • 192 vs 200 f'cast, 195 prev
    • GDP Core PCE Price Index
      • 4.3 vs 3.9 f'cast/prev
Market Movement Recap
08:43 AM

slightly weaker after data. 10yr yields are up 3.5bps at 3.962. MBS are down an eighth of a point.

10:24 AM

short-covering, dip-buying, and/or big block trades helping bonds turn green.  10yr down 2bps at 3.908.  MBS up just over an eighth.

01:04 PM

Modestly weaker after modestly weak 7yr Treasury auction. Still green though.  10yr down 1.5bps on the day at 3.912.  MBS up 3 ticks (.09). 

02:04 PM

Back to stronger levels as bonds cheer the passing of the week's supply concerns.  10yr down 5bps at 3.877.  MBS up 6 ticks (.19).

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