Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on March 19, 2010

Locking Stance: LOCKING    Mortgage Bonds: –13bp

Mortgage backed securities dropped decisively between yesterday and today, much on the heels of record new Treasury Announcements, so I hope you heeded my change back to a locking stance.  As I said yesterday, the best we would likely see is a sideways trading pattern, and that is questionable.

There is no data to be released today, but it is a quadruple witching Friday for the stock market and that sometimes sends traders into a bit of a frenzy as the try to cover their positions.  Nevertheless, when there is no data, traders look to the charts more so. 

And when we look at the charts, we see MBS prices have gapped lower through their 100-day moving average and opened even with their 25-day moving average.  From there, they fell through their 50-day moving average before finding support at their most recent low and have since rebounded.  The 10-day moving average has fallen through the 100-day MA as expected and now sits just 6 basis points above the 25-day MA, making the next negative crossover a virtual guarantee.  Stochastic indications have also turned negative, so it looks like the 100-day MA will likely turn into resistance versus the support it had been holding.  Of course, this could change if MBS prices manage to make a significant comeback, but that does not look likely right now. 

What does this mean for Mortgage Rates?  Mortgage rates have edged higher since yesterday and, while the outlook is still not certain, the odds favor higher mortgage rates once again.

(Note: MBS Commentary is back up and running and I am transferring data slowly since the beginning of February.  After the transfer is complete, I will get back to adding new content geared mostly to consumers for now.)

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