MBS Day Ahead: What Exactly is a Post-Range-Bound Momentum Spike?


Posted To: MBS Commentary

In putting together today's chart, I found my fingers involuntarily typing the phrase "post-range-bound momentum spike." It made perfect sense in my mind at the time, but like many concepts pertaining to the analysis of market movement, there's no perfect way to describe it with only a few basic words. The first word I considered was " breakout ," because bonds have broken out of their recent range. But "breakout" doesn't really reference what was previously confining bonds, nor does it make a comment on the implication. A post-range-bound momentum spike however… that's something we can work with, sort of. In essence, we're dealing with the following flow of events: bonds enter a range (the narrower and flatter it is, the better, in terms…(read more)

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