Looks like we're falling out of the trend channel just slightly. And with that, our hopes of reprices for the better today are diminishing.
Considering the recent and decent run of good luck, locking feels like it should be heavily considered tonight, yet the price curve does not indicate the potential of a reprice for the worse tonight. And although the street is not confident in MBS performance, remember that street sentiment relates almost exclusively to spread whereas we are much more concerned with the raw prices.
So although spread may well widen a bit more, it doesn't mean prices will fall. A very tough call for us here. If you can't afford the risk, tonight's one of the better in recent weeks. If, however, you agree that the next stopping point for the Dow is 11,000, there is likely more room for improvement in the immediate future.