Morning Market update:
Stocks and Mortgage Bonds are both lower so far today. It’s a very quiet economic news day, but next week will be a busy one, with a focus on Housing. Existing Home Sales, the FHFA House Price Index, New Home Sales and the second look at 2nd Q GDP are all due for release.
With lack of new today, technical analysis will be in focus. Yesterday, Mortgage Bonds were able to finally close above resistance at the 100-day Moving Average and Fibonacci Level. Bonds have been pulled back beneath resistance this morning. Once Bonds do break out of this range for real, there is quite a bit of room both higher and lower. If Bonds are able to break higher, there is about 75bp before hitting the next resistance level.
The 10-year has been trading sideways for a while now. The good news is that Yields are trading beneath overhead resistance and there is a lot of room to the downside, so lets hope it takes the path to least resistance and moves lower. Hope everyone has an awesome day!