Much of Friday’s increase in yields was associated with perceptions of growing economic strength and possible impacts on inflation

What a difference a long weekend makes as the majority of sellers rode off into the sunset and have not returned to rule the day as they did on Friday. Selling late last week eliminated some bullish signals off our current trend that had been established earlier this month. The drop did however find some support at the 21-day moving average at 118-055, which is also where an up-sloping trend line off the August/September lows lies. The reaction to that area suggests that selling momentum is unlikely to immediately build on the shift away from the bullish camp. Much of Friday’s increase in yields was associated with perceptions of growing economic strength and possible impacts on inflation.

Equity prices surged very strongly last week and followed through yesterday to finish at the highest levels this year for the S&P and Dow Jones. Bond markets were closed yesterday and have little in the way of new data this morning. However, several economic reports will be released later this week including retail sales tomorrow and the FOMC minutes due out later today. Upcoming announcements of quarterly results from U.S. corporations could be just as important as economic data as an indicator of economic health and bond markets will have much to digest over the coming days. Meanwhile, gold continues to surge as investors seek havens from the possibility of inflation and further dollar devaluations and oil surged to over $74 per barrel. Currently Mtg backs are up 8s, along with the 10yr up 20. Stocks are off about 36 points.

About Max Leaman Austin Mortgage

GREAT RATES, LOW FEES, CLOSE ON TIME™ ---- 2012 Ranked #1 Austin Residential Mortgage Lender (Austin Business Journal) 2010, 2011 & 2012 Five Star Professional (Texas Monthly) 2009, 2010, 2011, 2012, 2013 PrimeLending Chairman's Circle Award 2009, 2010, 2011, 2012 Scotsman Guide Top Originator (Top 200 Mortgage Professionals in U.S.A.) Better Business Bureau "A+ Rating" National Lender Rankings (Scotsman Guide): Top Purchase Volume (No. 10) Most Loans Closed (No. 32) Top Dollar Volume (No. 88)

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