Yesterdays Sell Off Not as Bad as It Seems

Yesterday was a not a good day in the mortgage backed securities market. However, all things considered it is not as bad as we may think based on these graphs. All things considered our market moving forward should rebound nicely this coming week. Let's take a look at the two day.

As you can see yesterday resulted in an 18 tick loss. You can also see an arrow with the word "roll" next to it. This points to the fact that yesterdays note rolled into the future trading note. This happens every month. Futures 99% of the time trading lower than current months due to the the unknown and higher level of risk. Consequently when roll occurs our market falls.

As a result pricing is slightly worse today, but "Don't Panic." Our market is showing signs of support which is evidenced by our being up 3 ticks currently on the day. Fridays are typically light in volume so Monday will be more exciting.

I will be publishing the open house flier shortly so stay tuned.