Hand on the lock trigger

Stocks showed slight optimism yesterday, while the bond market had the day off in observance of Columbus Day.  Markets are all relatively flat today, as investors wait on any word from Washington regarding a deal on the debt ceiling.  Currently, both the Senate and the House appear to each have a plan ready to go.  The fact that there has not been an agreement ahead of schedule should be a surprise to no one, so any news will trigger plenty of volatility.  mortgage bonds are trading at the low side of a channel , which is currently being held up by the 25 and 100 day moving average.  We will suggest a cautious floating bias with the lock trigger close at hand.