Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on July 8, 2010

Locking Stance:  LOCKING     Mortgage Bonds:  -9bp

As you can imagine for those of you watching the markets during the day, I switched stances back to locking yesterday early afternoon even before the “drop”.  Unfortunately, yesterday was one of those days I was nowhere near access to the internet and my Blackberry was not allowing me to post from it, which is rather unnerving to say the least.  It comes down to the fact I need someone else or some other way to make these posts happen, which I am looking into.

OK, enough of the BS, let’s get down to what is going on and the possibilities of the future.  Yesterday, MBS prices battled forward and put all of their effort into trying to break through the upper resistance layer.  Well, it failed.  Obviously there is more to that as we look into other factors, such as stock market direction and such, but that is what the charts show.  The bottom line is the charts turned very bearish (bad news for low mortgage rates) and that pattern is now etched in the charts.  Today, MBS prices are trying to stop the bleeding and are currently holding at the support of the 10-day moving average which also happens to be about the bottom of a sideways pattern which could develop.  If MBS prices can hold out and even turn back higher, a sideways pattern could be established.  Further erosion, however, over the next few days could translate to a trend reversal and possibly good-bye to low mortgage rates, at least these levels.

The weekly Jobless Claims were reported this morning, coming in at 454K, showing improvement and certainly not assisting MBS prices at the moment, especially with the 4-week moving average dropping to 466.0K.  Continuing Claims also dropped, now at 4.413M, reflecting some hiring but also the expiration of benefits for some as well.  Coming up in a few moments is the Treasury’s next announcement, this one concerning the upcoming 3-year T-Note, 10-year T-Note and 30-year T-Bond auctions.  This added supply could weigh further on MBS prices and drive them below support.  This afternoon will see a couple of good-to-know reports, namely Consumer Credit and Money Supply. 

What does this mean for Florida Mortgage Rates?  Low mortgage rates, at least these levels, may be a thing of the past as mortgage rates edged higher and may not be able to hold.  The long-term outlook has become uncertain once again and we may be changing to a long-term outlook of higher mortgage rates though it is still too early to be certain.

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