MBS Day Ahead: Month-End Bond Buying Could Be A Trap

Posted To: MBS Commentary In the day just past, bonds extended the gains seen on Monday with 10yr yields hitting 1.98% before encountering resistance. The gains are most readily attributed to an imbalance of short positions (traders betting on rates moving higher) and a smattering of strong buying demand amid low volumes.

Speculators began to eye the ERM and wondered how long fixed exchange rates could fight natural market forces. Britain upped its interest rates to 15% (5% in one day) to attract people to the pound, but speculators, George Soros among them, began heavy shorting* of the currency.

 · The pullback ahead of the weekend was minor. The technical indicators have barely registered it.. S&P 500: Bond yields fell every day last week,

Mortgage Rates Steady Ahead of Potential Volatility Mortgage rates. rate hike outlook (the Fed recently said that Brexit and a potential shift in employment data are the two biggest hurdles preventing a rate hike). While some parts of financial.