Market players expect prices to move marginally lower this week as the Street consolidates after last week's heavy issuance.

Approximately $6 billion of tax-exempt bonds and notes were sold during the previous five sessions, marking the highest weekly sales since the $6.38 billion for the week ended Aug. 14.

Although results were positive and the market remains bullish on near-term price prospects, yields are likely to rise this week as the Street digests remaining bonds, traders said.

"We've had a lot of new deals and we'll take some time to consolidate here," a trader said Friday. "It's also a holiday week and that will contribute to a downward drift as will any downward move by Treasuries."

Treasury prices were mixed Friday, with the short-end posting modest declines while the long bond inched up 1/8 point to yield 7.53%.

However, traders seemed less concerned than analysts about the auctions slated for this week. Most attention was focused on actions in Europe and the possible realignment of the European Monetary System.

The Treasury will sell $23.6 billion of bills and $15 billion of two-year notes on Monday, and $10.75 billion of five-year notes on Tuesday. Once the auction is out of the way, many analysts forecast a bright outlook for Treasuries.

"A further Fed easing is a more realistic prospect than the Fed has led the markets to believe," Philip Braverman, chief economist and senior vice president of DKB Securities Corp., says in the firm's "Weekly Credit Market Report."

In addition, "there is a lessening fear of outsized spending initiatives by President-elect Clinton," he notes.

Instead, he says in the report, discussions center on expectations of a reduction in the size of the quarterly 30-year bond auction to reduce bond yields and "the Clinton stimulus initiatives will be more fiscally conservative and market-friendly than the market fears. "

"The extended credit market outlook is therefore favorable" Braverman adds.

Goldman, Sachs & Co. forecasts a 30-year Treasury bond yield of about 6.50% within the next 12 to 18 months, said Aaron Gurwitz, a vice president of fixed-income research at the firm.

Gurwitz envisions that the bond markets will act as a fourth branch of the government, sending out signals that will effectively prohibit the Clinton administration from enacting too much of a fiscal stimulus package.

Looking ahead, some market players call for lower yields going into January.

They say municipals are attractive because of expectations of higher taxes from a Clinton White House, prices are cheap to other markets, and the economy remains fundamentally weak.

"We're going through the pause that refreshes, but it won't last very long," said Joe Deane, senior vice president and managing director of Shearson Lehman Advisors. "Retail shops are doing a ton of individual business and we're very constructive about the market right now at these levels."

Also, Jan. 1 is expected to be the largest municipal redemption date ever. More than $9 billion of municipal bonds may be redeemed or called away from investors.

Approximately $7.36 billion of municipal securities are slated for redemption, either because they were prerefunded to first call, or because they were escrowed to final maturity.

In addition, another $2.1 billion of tax-exempts are very likely to be called because they have coupon rates of 7.5% or more. The total is $9.46 billion.

Market players speculated that funds would begin to buy replacement bonds over the next month, adding to arguments for lower yields. In addition, dealers seem generally positive about owning bonds, in anticipation of strong retail demand as the new year approaches.

Supply is generally expected to level off, at least for the next week. Approximately $3.5 billion of new bond deals are expected to be priced this week. The negotiated sector features $300 million of Georgia Municipal Electric Authority refunding revenue bonds, to be priced the First Boston Corp.

The Bond Buyer calculated 30-day visible supply at $4.57 billion. The Blue List of dealer inventory rose $158 million, to $1.22 billion.

On the economic front, the Treasury Department today releases its monthly budget statement for October, followed by the release of October durable goods tomorrow. Initial jobless claims for the week ended Nov. 14 will be released Wednesday.

Friday's Market

Activity was limited on Friday, as market players looked ahead to this abbreviated week's new offerings.

The State of New York Mortgage Agency announced final details on its offering of $100 million of home owner mortgage revenue bonds that sold competitively Thursday.

Goldman Sachs placed the winning bid for $31.76 million Series 29A bonds, at an interest rate of 2.70%. The bonds are not subject to the alternative minimum tax.

Merrill Lynch & Co. submitted the winning bid for $68.24 million of Series 30A bonds, which are subject to the federal alternative minimum tax, at an interest rate of 2.75%.

The bonds will be remarketed on Dec. 1 and are subject to a mandatory tender on Dec. 1, 1993. The bonds carry long-term ratings of Aa from Moody's and short-term ratings of VMIG-1 from the agency.

In secondary dollar bond trading, California Public Works AMBAC 6.40s of 2016 were quoted at 100 1/2 to yield 6.35%; Piedmont Municipal Power Agency MBIA 6.30s of 2022 were quoted at 99 to yield 6.38%; California GO 6 1/4s of 2019 were quoted at 98.58 to yield 6.36%.

New York City Water and Sewer 6 3/8s of 2022 were quoted at 97 1/2 to yield 6.57%; Puerto Rico GO 6s of 2014 were quoted at 95 1/2 to yield 6.39%.

In short-term note trading, action was light, but yields declined as much as five basis points as investors showed good demand for a limited supply of notes, traders said.

In late trading, New Jersey tax and revenue anticipation notes were quoted at 2.65%; Los Angeles Trans were quoted at 2.67%; and Pennsylvania notes were quoted at 2.70%.

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