Mortgage Backed Securities are up again today, giving some boost to you rate sheet pricing. This is on the heals of two positive days both Thursday and Friday. Hopefully this indicates that we have established a bottom and have created a new trading channel.
This is a big week in economic reports that will undoubtedly cause more volatility. This morning the NY Empire Manufacturing Index was reported much lower than expectations, helping to give mortgage bonds a boost in early trading.
With the oversupply of treasuries, there is still much concern as to whether this recent rally can continue. Technically, Mortgage Backed Securities are trading very close to the top of the current trading channel. Those hoping that rates will get back down to the levels seen three weeks ago will most likely be disappointed. Still, pricing has come down some from the high we saw on Wednesday of last week. For now we are floating, but being very mindful that the market could turn at a moments notice. Locking might be the safest route though.
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