The sense of anxiety and uncertainty is palpable. Almost in perfect unison, when the lunch bell rang, traders in equities and bond markets alike began taking chips off the table ahead of next week’s seemingly epic FOMC events. Before that, MBS had reached its best levels of the week, and even after the slide in the PM hours, managed to close at the best end-of-day levels of the week. 10yr yields didn’t make any tremendous heady in the intermediate range, but they did manage to confirm the break below the 2.18 level that had been providing a floor of resistance all week. It would be nice if this was a meaningful bullish change of pace, but with this being the first visit to 2.10 all week, this barely scratches the bullish surface of the 2.31-2.07 range boundary we’d expected to span the NFP to FOMC time frame. Beggars can’t be choosers however, and in this recently bearish bond market, ending in the green at the week’s best levels is better than almost any other Friday in recent memory, despite the Euphoric highs earlier in the day.
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