Current Price of FNMA 6.0% Bond: 99.06, +3bp
Bonds are headed in the right direction – higher, and away from the Falling Resistance Line. But we’re not ready to light up a bottle rocket and celebrate just yet – with some potentially volatile trading days ahead, Bonds still have a ways to go before we’ll consider the move above the tough Falling Resistance Line completely convincing.
There are only two low-level economic reports that arrived today, Factory Orders, which fell by 0.5%, but were better than the decline of 1.2% that analysts had expected. Pending Home Sales – which is a volatile number because it only measures contracts, not closings – fell by 3.5%, underscoring softness in the housing market.
With an early market close for Bonds at 2:00pm ET followed by a full close tomorrow in observance of Independence Day, trading should be light this morning – but that can sometimes lead to volatility.
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