Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on October 6, 2008

Locking Stance:  CAUTIOUSLY FLOATING     Mortgage Bonds:  +53bp

Mortgage bonds are off to a good start today, which I eluded to as the week drew to a close.  As the week was coming to an end, I kept saying Friday’s close will set the stage for the future of mortgage rates and that is true so far.  Since bonds managed to close just above their 25-day moving average on Friday, that allowed them to break free for a rally today.

Enough of the technical side and let’s get down to the why.  Traders are not happy with the final bailout law that President Bush passed and since they have gotten what the want so far, they are asking for more and are willing to send stocks further into the abyss to get it.  Right now, the DJIA is down over 200 points to prove their position.

Adding fuel to the fire burning away at stocks is that oil is down considerably and the dollar has strengthened.  All of these factors are forcing money to flow into mortgage bonds, and treasuries, as a result.  That means lower mortgage rates will be heading our way for now.

Caution must remain, as usual, as traders have been having major “mood swings” lately and that could turn a great day into a horrible one real fast.  Mortgage bonds are already off their highs, but are not showing any real weakness, at least not yet.

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