MBS Day Ahead: Another Rocky Start Fans Flames of Rising Rate Trend

Posted To: MBS Commentary

Stop me if you've heard this one before, but the bond market is in the midst of a big-picture correction from the all-time lows seen in the middle of 2020. The correction has taken the form of modestly-sloped 'trend channel' (parallel lines marking higher highs and higher lows in Treasury yields). A week ago today, yields bounced at the lower end of that trend channel, thus introducing the risk of a move back to the other side (the higher side!). Resilience on Friday and Monday offered hope that yields could find a lower ceiling before making such a move, but based on bond trading within the past 48 hours, the risks remain. Hope remains as well, due to the fact that yields are still technically trying to hold under the 1.125% level which has provided support on 9 of the past 17…(read more)

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MBS Day Ahead: Another Rocky Start Fans Flames of Rising Rate Trend
MBS Day Ahead: Another Rocky Start Fans Flames of Rising Rate Trend

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