We all hope we'll never have a theft, fire, flood or other weather-related disaster happen to our homes. But if one of these things should occur, you don't want to rack your brain trying to figure out what you've lost in order to file your insurance claim. The answer is to create an inventory of everything that's in your home. But the time to do it is now – before the loss occurs.
Overall, trading today has been a range-bound affair with prices above yesterday’s lows and below yesterday’s highs. Traders call this an “inside day” which is simply a neutral pattern. Expecting mortgage pricing to hold steady is a pretty good bet.
We see the set up as neutral, given a multitude of bearish divergences on one side and Fed Chief Bernanke and his dollar printing press on the other. Throw all the factors together and you can make a good case for the market and Austin mortgage pricing to stall unit early November’s elections and FOMC meeting.
Austin mortgage rates, already at historically low levels, have been sliding even further the last few weeks. Nonetheless, the Mortgage Bankers Association's Weekly Mortgage Applications Survey showed purchase applications down a bit from the week before.
The economic data released during the week continued to show low inflation and modest economic growth. As a result of no real surprises, Austin mortgage rates ended the week with little change.
Next week will be the true test, one that we would expect will see the market trade sideways to a little better (slightly improving mortgage pricing). Overall, we think this is the low probability trade as QE2, even though it is fully priced in, is a force to be reckoned with. When the Government is the buyer of choice, most follow the ant age, “Don’t fight the Fed.”
Text book trading here as this baby is tracking the down trend line like a hunting dog. Good news is that we are at good support mentioned this morning. Play defense, Austin mortgage borrowers, as the light at the end of the tunnel is not the other side.
Call the market neutral/bearish with good support nearby. As we have preached all week, defense is your friend, Austin mortgage borrowers, and the exclusive float down option from Max Leaman is a no brainer.
13 billion of 30 year bonds just hit the tape. Yield 3.852% with a whopping 3.2 bps tail. Indirect Bidders and Direct Bidders took 41% of the auction, leaving the street to mop up nearly 60%. Bid to cover stunk at 2.47 to 1. Overall, this was not a dog but a pack of them. Give it a D just because we hate to fail anybody. Bonds, notes, and mortgage backs are trading fast market conditions with the 10 year off ½ point and the bond down over 1 point. MBS now off 5 to 7/32’s.
Austin mortgage borrowers: best to take a conservative approach given the amount of volatility we expect.
