MBS MID-DAY: Bonds Looking for Support After Modestly Weaker Morning

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Posted To: MBS Commentary

Following yesterday's FOMC events, bond markets rallied back in line with recent low yields. With the rally taking place in the afternoon, Asian and Europe markets didn't get their chance to react until this morning. The initial reaction was positive, with bonds following through to the best levels since early June, but after 10yr yields hit 2.26, they were unwilling to go any lower. By the time they'd bounced there a 3rd time, there was a clear case for technical resistance. European bond markets bounced at the same time, and at a similar inflection point relative to their recent range. In other words, the trading levels that had acted as a general ceiling for rates in May have now been acting more like a floor in June. There's no specific yield to watch when we're talking...(read more)

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Source: http://www.mortgagenewsdaily.com/mortgage_rates/blog/480765.aspx

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