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MBS Day Ahead: Another Day, Another Record High For MBS

Posted To: MBS Commentary

While there's no way to know how the day will wrap up for the MBS market, we know how it's starting out. We also know how 4 of the past 5 days have started out (and wrapped up, for that matter): at all-time highs. The following chart of 2.0 UMBS candlesticks shows the consolidation and resistance around the 103.00 level. The breakout occurred last week, and resulted in a classic case of follow-through from a technical standpoint . Broader bond market trends have been more even-keeled even though we're also seeing what is effectively a record run in 10yr yields (throw out March 9th, and we're at record low yields on 3 out of the past 4 days including today). Although we can place the past few months of movement in a linear trend channel, Treasuries–like MBS–consolidated in…(read more)

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