Florida Mortgage Market – Morning Update

by Florida's #1 Mortgage Planner on March 7, 2008

Locking Stance:  CAUTIOUSLY FLOATING     Mortgage Bonds:  +87bp

We finally got the news we were expecting and mortgage bonds are reacting as we expected all week, however, with all of the damage that has been done, this move may prove futile.

Today’s Jobs Jamboree came in as a disappointment which we had talked about earlier this week and in our Forecast for the Week post.  We were hoping the "W" pattern would hold, maybe even get a triple bottom developing, and bonds would take off on the heels of the jobs data.  Unfortunately, with bonds falling like a greased brick all week, the jobs data is only bouncing them up against the roof (200-day MA).

The data this morning showed Average Work week and Hourly Earnings in line with expectations, but the non-farm payrolls dropped 63K, well below expectations of 25K.  Interestingly enough, the Unemployment Rate ticked down again, coming in at 4.8% versus the 5.0% expected.

Bonds are rallying on the news, but will face tough resistance at their current levels, even with the 200-day moving average.  If bonds fail to break back above this layer, a downward trend will be solidly established and, as the charts are now showing, things could get very ugly.

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