Mortgage Bonds are up 41 bps as of 910am this morning. Core PCE, Personal Consumption Expenditures without food and energy, was released this morning in line with estimates, inflation is still under control. Year or Year PCE is 2.1% slightly above the Fed's target range of 1-2% but this the Fed expects that to creep up in the coming year more before it retreats back to their comfort zone.
Expect a nice pop in rate sheets this morning has bonds test resistance at the 200 day moving average. Yesterday bond did rally late day and close very near this open, this shows indecisiveness with the bulls and the bears, but give the bears the edge for now. The close yesterday should be a new level of support which would potentially narrow the trading range of bonds. Bonds are 1 tick below the 200 day moving average at their highs of the day, if stocks have a down day we could see a break above, but confirmation would have to be made next week as well for it to stick. See chart below:
See how rates sheets look this morning with pricing and realize this could be the best we will see for the next few weeks. Sit tight and be prepared to lock, a very very cautious float for now.