MBS Day Ahead: Bonds Thinking About Taking a Lead-Off?


Posted To: MBS Commentary

I use the baseball/lead-off analogy quite a bit to refer to a range breakout that occurs before the important event that is most likely to cause a breakout. In the current case, that event is actually a series of events culminating in next week's Jobs Report. Next week is important in a general sense because it's the first week of December, and it marks the start of the final approach to the end of the 2018 trading year. The first 3 weeks of December frequently see an uptick in bond market momentum. Individual focal points frequently include the jobs report and the Fed announcement that follows roughly 2 weeks later. With the sideways momentum strongly intact on the first 3 days of this week, we were getting closer and closer to that first week of December. But as of this morning, bonds…(read more)

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