Posted To: MBS Commentary
Bonds were horribly weaker yet again overnight, and the same old factors are in play. These aren’t glamorous, satisfying to understand, or easy to explain to colleagues and clients, but that doesn’t make them any less relevant. Chief among them is the tradeflow story. Here’s how I described that in this morning’s update on MBS Live : The frustrating thing about all this from a traditional market-watching perspective is that the biggest motivation for trading is TRADING itself . That’s the simplest way to discuss the concept of “tradeflow considerations/motivations. Traders are forced in to new trades when certain levels are hit. Those new forced trades become the price-movers for the next forced trades, and the snowball rolls on. Treasuries were deposited on the domestic…(read more)
Via:: MBS MID-DAY: One Fringe Benefit of Opening Horribly Weaker: Reprices Come Easy
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