As benchmark TSY rates re-test higher yield levels, trading flows in the TBA MBS market have fizzled out. We went from every offer getting lifted to dealers wanting bids....
The FN 4.0 is +0-06 at 99-11 and the FN 4.5 is +0-06 at 102-ROCK (102-00). Yield spreads are now WIDER and rate sheet influential MBS prices are holding near intraday lows.REPRICES FOR THE WORSE HAVE BEEN NOTED.
The dollar is on a tear. The EUR/USY is down to 1.469, breaking several pivot points in the process. Proprietary trading models ("black box") are likely sending very BEARISH signals from today's EUR/USD weakness, implying the EUR/USD pair may see further weakness ( So the dollar may continue to rally.
Check out the highs and lows on some of these currency pairs...
The dollar is STRONGER and stocks are WEAKER. Odd? (note sarcasm please). Stocks are heading lower.....cross your fingers for flight to safety into the rates market.
Decent support at 118-20 in 10yr futures...3.41% in the cash market.