MBS have dropped below the 200 DMA, day moving average, this morning. This is not a good start today. From yesterday at noon until now MBS have dropped about 60 bps. Yesterday the Fed statement said they were a little concerned about inflation, but also downgraded their look on employment. The jobless claims in the last quarter have been close to best in a decade, so it is interesting as to what they know and what the data is saying. This did 2 things that were not bond friendly: 1) it gave stocks momentum and 2) it made the markets think a rate hike is not coming in December. Who knows what will happen, but I strongly suggest LOCKING; the 4+ week trend above the 200 DMA has been pierced.
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