Last week was another rough one for mortgages. The outlook at the start of the week seemed very favorable following the employment report rally with the 10-year back in its range - though at the high end. In fact, Monday saw good buying from real money investors, particularly 5s and 5.5s, on the improved fundamentals, ongoing favorable technicals and lower vol.

Tuesday and Wednesday, however, were a very different story. Active selling hit the mortgage sector as the 10-year backed up to over 4.50% by Wednesday's close. There was strong selling from originators and servicers as well as fast money. Better selling was seen in lower coupons, while there was some limited up in coupon movement reported as the curve steepened.

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