MBS Day Ahead: Back From Break, Bonds Still Waiting For a Breakout


Posted To: MBS Commentary

Heading into the day and a half holiday break, bonds had been consolidating in a narrower range centered on 2.85% in terms of 10yr yields. Now, as bonds return to finish out the week, they're consolidating in a narrower range centered on 2.85! As can be seen in today's chart, this particular consolidation is running out of room. Breaking through one of the lines carries a slightly higher probability of a higher-momentum move. That said, I don't think this is a market that is going to be overly motivated by such technical developments. "Technical" in this case, refers to technical analysis –one of the the two main market approaches which emphasizes using only the past movement of a security (and math applied to it) to comment on its future. From a purely technical standpoint…(read more)

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