Posted To: MBS Commentary

This is a bit of a paradoxical outlook. In short, things have been consistently downbeat enough for the bond market that we’re due to see a friendly day or three in the near term future. Why is that? It has to do with the number of consecutive days that yields have moved higher. In the current case, it’s 6 in a row (unless we get a big, friendly reversal today). 5-day streaks happen fairly often. 6 day streaks are less common. And probability drops off a cliff from there. After these streaks run their course, the result is at least a few days of sideways-to-lower yields. Somethings the bounce is underwhelming, but other times it provides a material improvement. Will it happen tomorrow though? That could be a tough sell with next week’s Treasury auctions looming. It could also depend…(read more)

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Published On: February 4, 2021 / Categories: Mortgage News /