Technical Breakout in Treasuries. Does it Matter?

Bonds began the day in much weaker territory as Treasuries followed European yields higher after a series of stronger PMIs overnight. Domestic traders added to the weakness early with 10yr yields hitting their highest levels since November.  Bonds found their footing after an as-expected JOLTS report and MBS even made it all the way back to “unchanged” just before 3pm.  Nevertheless, 10yr yields had broken their recent 4.32% ceiling.  As always technical levels don’t predict the future.  This breakout reinforces the headwinds of the past few weeks and acknowledges the risks associated with the incoming data.  If that data is friendly, this will not look like an important technical breakout in hindsight.  But the opposite is also true: stronger data would make this breakout look like ominous foreshadowing.

Econ Data / Events

Job Openings

8.756m vs 8.75m f’cast, 8.748m prev

Market Movement Recap

08:52 AM 10yr yields up 7.8bps at 4.394. MBS are down just over a quarter of a point.

11:12 AM Pushing back after uneventful JOLTS.  MBS down only an eighth.  10yr up 4.5bps at 4.361.

01:51 PM Sideways to slightly stronger.  MBS down only 2 ticks (.06) and 10yr up 4.3bps at 4.359

02:30 PM MBS turn green, now up 1 tick (.03).  10yr still up 4.4bs at 4.36, but 5yr Treasury now unchanged as well.

Published On: April 2, 2024 / Categories: Mortgage News /