If you are watching the 10 year treasury today, you might have your head in the sand.  MBS's have been steadily improving into this afternoon, with  the 5.5% coupon at 101-15.  Doesn't seem likely that lenders will reprice before big ben talks, so that raises the question: sail directly into the gathering storm and hope to be catapulted closer to your destiny?  Or tack hard starboard and go with the safe passage?  No way to advise you with certainty. 

But you can take your ship right to the edge of potential oblivion before turning back, as long as you can read the signs in the market immediately following the announcement and are ready to act accordingly in terms of locking.  Reading those signs is incredibly difficult with the very "gappy" spreads currently existing between treasuries and MBS's.  So the first problem is that you cannot get an indication of rate direction from treasuries.

The second problem is that MBS's have improved with stocks several times this week, today included, so you can't really tell by the DJIA.

The third problem is that by the time I have seen and posted the MBS reaction, it can still reverse based on MBS specific factors.  Nonetheless, I'll keep you up to the minute with facts and no opinion during the zero hour. 

The only opinion I'll leave you with is this: If the cut is .75 or lower, float until further notice as I think this will quite beneficial to MBS.  .5 would be amazing.  1.0 is the grey area and 1.25 is either a certain lock if stocks rally or a certain float if stocks stagnate or drop.  If they do come out with 1.25, and the market didn't rally, all the sudden, bonds will look very nice.

Whatever the case, the highest probabilities are at .75 and 1.0.  Again, I think you can float with a .75, and that 1.0 could go either way.

Either way, stay tuned here, and keep hitting your refresh key!