At the heart of today’s global trading session was a formidable overnight rally that brought 10-year returns as high as 1.25%. That was strong enough to warrant a corrective jump between 7:00 a.m. and 9:30 a.m., but returns peaked at just over 1.30% multiple times, not once. The result is a classic turning / turning point on the 2 day chart– one that we can continue to look for evidence that bullish aspirations are shifting. As for today, the repeated ricochets at 1.30% of the rally have at least made it more valid.

Economic data / events

  • Fed MBS purchases 10 a.m., 11:30 a.m., 1 p.m.

  • Unemployment claims 373k vs 350k f’cast, 371k prev

Summary of the market movement

8:23 am

The bond rally extended overnight, fueled again by the European session. The 10-year yield was only 1.25% before currently rebounding to 1.28% (still down 4+ basis points). MBS is up more than an eighth point to 2.0 coupons at 101-23 (101.72).

09:35 am

Sellers push back profits. 10 years up from the lows in the morning by 3 basis points, now only 2 basis points over the course of the day at 1.30%. MBS is more stable, still an eighth at 101-22 (101.69).

10:55 am

Buyers push sellers back! Now back to the low yields of the domestic session and MBS up to the daily highs (2.0 coupon increased by more than a quarter point). Profits started shortly after the last update.

3:50 pm

Daily best values ​​for MBS with 2.0 coupons around 10 ticks (.31) at 101-28 (101.875). 10-year yield fell 3.5 basis points on the day to 1.288 (supportive cap at 1.30-ish, in line with yesterday’s lows).