MBS RECAP: 1/5/2012

By: Matthew Graham
MBS Live: MBS RECAP
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FNMA 3.5
102-29 : +0-04
FNMA 4.0
105-01 : +0-02
FNMA 4.5
106-11 : -0-01
FNMA 5.0
107-29 : -0-03
GNMA 3.5
104-14 : +0-03
GNMA 4.0
107-08 : +0-02
GNMA 4.5
108-30 : +0-00
GNMA 5.0
110-23 : -0-02
FHLMC 3.5
102-24 : +0-04
FHLMC 4.0
104-28 : +0-02
FHLMC 4.5
105-28 : -0-01
FHLMC 5.0
107-13 : +0-00
Pricing as of 4:04 PM EST
Afternoon Market Updates
A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBS Live Dashboard.
3:17PM  :  ALERT: MBS Rallying Into Afternoon. Still Limited by Range. Positive Reprices?
The overall range remains tight and MBS remain capped by resistance (for now) at 102-30, but things have had a noticeably bullish overtone since the last alert and we wouldn't be surprised to see an early-to-act lender or two reprice for the better, but neither would we be surprised if absolutely no one repriced at all. Bottom line is that negative reprice risk is gone at this point (at least as far as MBS-driven risk).
11:50AM  :  ALERT: Resistance Holds, MBS Off Highs, Reprice Risk Shifting Negatively
Whether or not a "negative shift" in reprice risk constitutes potential reprices for the worse is questionable. After all, MBS are still +1 on the day at 102-26 with high-side resistance at 102-30. So although we're not especially concerned about reprices for the worse, the positivity mentioned in the previous alert does need to be unwound, taking us at least back to neutral territory. In general, reprices remain unlikely. We'd be a bit more concerned if MBS fell through 102-25 and most concerned about a break below 102-22.
Featured Market Discussion
A recap of the featured comments from the Live Discussion on the MBS Live Dashboard.
AQ  :  ""favorable supply/demand technicals"..."rinse and repeat""
AQ  :  "the story of 2010, 2011...and 2012"
Matthew Graham  :  "this "more buyers than sellers" thing is getting repetitive "
Mike Drews  :  "mann....it's like mbs aren't even watching treasuries..rude"
Jeff Statz  :  "you say harp 4.0 i say 0.4"
AQ  :  "Another #MassRefi Program Rumor? That's what, the 10th or 11th one we've heard since 2009? I apologize for being dismissive but come on..."