A flight to safety rally in the Treasury market led "down in coupon" MBS bids higher today. TSYs outperformed MBS by as much as 10-20 ticks though (spreads wider). Originators were light sellers while the Fed easily ate up any excess production today. Asia remains steady support of GNs.

FN30______________________________________

FN 4.0 -------->>>> +0-18 to 99-04 from 98-18

FN 4.5 -------->>>> +0-18 to 101-04 from 100-18

FN 5.0 -------->>>> +0-09 to 102-09 from 102-00

FN 5.5 -------->>>> +0-05 to 102-27 from 102-22

FN 6.0 -------->>>> +0-01 to 103-13 from 103-12

GN30____________________________________

GN 4.0 -------->>>> +0-21 to 99-10 from 98-21

GN 4.5 -------->>>> +0-20 to 101-10  from 100-22

GN 5.0 -------->>>> +0-11 to 102-19 from 102-08

GN 5.5 -------->>>> +0-05 to 103-04 from 102-31

GN 6.0 -------->>>> +0-03 to 103-17 from 103-14

I noticed an above average amount of reader inquiries regarding lock or float today. Consider the following when making this decision...

Tomorrow we get the BIG KAHUNA jobs report...The Employment Situation!!! This is the market's primary focus and should have an effect on MBS.

Markets have baked in the worst..if the data is in anyway positive or just better than expected be prepared for the liquidation of Flight to Quality Treasury positions and an MBS sell off (spreads will tighten though).  If the jobs data is as bad as expected or God forbid worse...FLIGHT TO SAFETY holds and MBS should benefit from yield curve stability.

Non-farm payrolls Consensus Estimate: -648,000

Unemployment Rate Consensus Estimate: -7.9%

Average Hourly Earnings Consensus Estimate: 0.2%

Hints: I know mandatory commitments are pricing out much better than usual...this tell us that investors are willing to pay for reliability right now. You should have noticed some aggressive (is your jpm pricing better?) pricing today....dont allow yourself to become apathetic to headline news...in other words dont get greedy...follow GUT-FLOP and be sure to consider the bearish sentiment in stock markets right now.

The MBS market did react in our favor to the housing plan by moving "down in coupon"... do not forget how quickly MBS market participants were to move back "up in coupon" after being burned for a second time following the announcement of the Housing Affordability and Stability Plan on Feb.10.

I am 80% complete with my analysis of DU REFI PLUS. It was a busy day and I am a little behind  so I will do my best to post tonight. In the event I am unable to complete it tonight I promise I will post in AM.