MBS Week Ahead: Housing Data and FOMC Minutes

Bond markets begin the holiday-shortened still waiting for a reason to do anything but merely continue in the same mildly negative trend.  Said trend has carried rates moderately higher after an even bigger move lower throughout January. 

These two trends are pictured in the chart below.  At this point, we're waiting to find out which one is "the correction" to a larger preceding move.  Either the teal lines mark the correction to 2013's gigantic move higher or the yellow lines mark the first correction to the new 2014 downtrend marked by the teal lines.  If the former, then we're already back to the business of moving higher in rate.  If the latter, 10yr yields would need to avoid crossing the 2.79-2.84 gap seen in the second chart.

Judging by the response seen to the FOMC Announcement in late January (i.e. "not much"), this 4-day week looks hard-pressed to offer much inspiration from scheduled events based on the fact that the release of the Minutes from that meeting is the heaviest hitter on the calendar (Wednesday at 2pm ET).  Apart from that, the economic data is light to moderate and concentrated primarily on the middle two days.

If there's a dud in terms of inspiration, it's today (Tuesday), followed closely by Friday.  Thursday--the only one without Housing-related data--is the busiest of the week with Jobless Claims, Consumer Prices, and the Philly Fed Survey.