MBS ALERT: Initial Reaction: Negative, but not Decidedly So...

Check out current prices on the rates page for the latest changes.

As of a few minutes ago, we were testing major resistance on the 10yr as we've been watching it bounce around 3.70.  Holding under there would be great on the day.

MBS are down a few at the moment with 5.0's at 101-07.  In more minute movements, we've seen it go a bit lower than this which means some lenders might reprice for the worse.  but

As far as the "big picture" is concerned, reprices for the worse would be premature at this point! 

Yes, you might get them, but there is no justification for them other than preemptive hedging.  We are seeing NORMAL post-fed volatility and there's just as good of a chance of this afternoon showing gains as losses.  Same story for Friday and beyond. 

My GUT response was that the announcement would not create a big sell-off in MBS, and would almost say it could be a positive.  Past dirty water under the bridge, Bill Gross said the same thing on CNBC just now.  Keep watching and waiting...