MBS Day Ahead: Good News and Bad News (Mostly Bad For Now)

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Posted To: MBS Commentary

We'll get to the good news in a moment. Bad news is obviously the order of the day as bonds are starting out with a big break through important technical ceilings. What's a technical ceiling? MBS Live members can always read up on knowledge base definitions in one of several articles on the topic: here , here , and here , but the shortest definition is "any price or yield level that has more often caused approaching yields to bounce as opposed to break through." It's largely a function of past precedent and in order to discuss today's relevant ceilings, we'll have to go back into the past a bit farther than we might like. The most recent precedents above 2.42 require a trip to March 2017, where we see 2.5 and 2.63 come into play. Before that, we'd have to go…(read more)

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