Lets check out how ranges are holding up...
In stocks, strong resistance at 910 (62% retrace) is keeping losses in check for the S&P.
So it looks like stocks are range bound right? If you cant answer this...look at the above and below charts. See it?
Since it appears that the "stock lever" is providing leadership for the gyrations of the yield curve today...check out what else is range bound! Equities move higher, TSY yields move higher. Stocks go lower, TSY yiels go lower. Stocks sideways, TSYs sideways.
Pivot points are price/yield levels that are generating more market activity. 3.48 has been a good pivot point lately. Support is holding strong near 3.50..."3.50nertia": not straying from there!
As long as benchmark's can remain range bound, "rate sheet influential MBS should too. (HOLD 101-27!!!)
The FN 5.0 continues to BANG BANG BANG against 102-00. BANG BANG BANG!!!
Real money buyers were indeed buyers are price lows...most other accounts have been muted though.
Today is the last trading day of the quarter...MBS books close at 3pm. That means Q3 starts at 3:01pm!!! Month end index buyers will likely enter into the market, PLUS yield spreads have been noticeable wider recently, so maybe we see some relative value bids give us a little nudge higher. We expecting/hoping for a little after hours action today! Dont get all excited though...the economic calendar, as in Non-farm payrolls on Thursday, is moderating upside and downside breakouts (RANGE BOUND!!!).
Tired of hearing me say that yet?
2s vs. 10s: 237bps
I wonder if Wells gives back that AM reprice for the worse?
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