Posted To: MBS Commentary
After a quiet, boring Tuesday, Wednesday is bringing the heat. It looked like things would get off to a solid start for bonds after weaker ADP data early, but a very strong ISM services report sparked heavy selling in the AM hours. We'll be assessing the risk of a slightly bigger-picture bounce throughout the day. In the bigger picture, it would take quite a bit of weakness to meaningfully threaten the prevailing downtrend in yields (attention bond market: we're not daring you to try it… just pointing it out), but any time a rally lasts this long and hits longer-term lows, there's a risk of a bounce in general. If we're looking for more specific cues, we might worry about the double bottom mentioned yesterday at 1.15+. Rates have bounced at or near that level 4 times in the…(read more)
Source: Mortgage News Daily
