Florida Mortgage Rates – Evening Report

by Florida's #1 Mortgage Planner on August 8, 2008

Locking Stance:  LOCKING     Mortgage Bonds:  +34bp

Mortgage backed securities, aka mortgage bonds, managed to climb back up to their 25-day moving average and rest 3 basis points above that level.  There is good news and bad news in this move, so let’s get down to it.

The good news is that they closed above their 25-day moving average, though not convincingly yet.  Chart patterns show their potential to break through this layer and mount a longer term rally, meaning lower mortgage rates ahead, as was the case yesterday, so that pattern is fairly solid now.  All of this taking place with the Dow Jones Industrial Average climbing over 300 points signals strength in mortgage backed securities.  Adding to the good news is that stochastic indications show a bullish crossover with plenty of room for a rally to occur.

The bad news is that 3bp does not signal a “breakthrough” regarding the 25-day moving average, and thus, resistance.  Another day or two will prove if it broke or not.  Additionally, it will take a solid move higher to break the long term downtrend, so it is too early to party, but things are definitely looking up right now. 

Have a great weekend!!!

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