Short and Long Term Inflection Points For Both MBS and Treasuries

It's been a choppy morning for MBS.  At their lows, Fannie 3.5's hit 102-13, while highs have been mostly capped out at 102-19.  The 6/32nds gap between those highs and lows isn't especially wide, so trading hasn't been volatile in that sense.  But the juxtaposition of those highs and lows between 9am and 11am is certainly more volatile price action than we've recently seen in MBS.

On the Treasury side, 10yr yields have set up a bit of a pivot for themselves this morning after experiencing their own volatile weakness.  Yields intially got a supportive bounce off a would-be ceiling around 2.06 before moving up into the 2.09's, and now that they have come off those highs, the same 2.06 level is offering some resistance to further improvements.  A break lower could pave the way for a meaningful break higher in MBS as well.  These pivot points can be seen in the chart below from MBS Live

A look at the longer-term pivot point behavior at 102-19.

Last week's breakout of the trend channel.  Next major pivot at 2.10 (pretty close already this morning in the mid 2.9's).

Justifying 2.10 as a viable long term inflection point (aka pivot point) for 10yr yields.  You can see what's at stake if something happened in the next 3 days to prompt a break about 2.10 (although keep in mind there are caveats with the word "break..."  In other words, don't run for the bomb shelter if we see yields briefly hit 2.10's for a few hours without confirming the next day with more time spent over 2.10 or more movement through to higher yields).