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Monday, November 24, 2014

Mortgage Bond Market Analysis - Monday morning holiday week edition

Good morning and HAPPY Monday.  Holiday weeks like Thanksgiving usually have light trading in both the stock and bond markets as traders often take advantage of the built-in holidays to take a vacation.  With no economic news and a rather narrow trading range - probably because of light volume as well as no data - the FNMA benchmark bond is up 2 basis points as I write this.

The Relative Strength Index is approaching overbought which means investors my start thinking about selling.  If you've read my blog before, you know that selling mortgage (or any) bond pushes the price down and rates up since price and yield / rate move inversely.  There is a fair amount of data on docket for tomorrow with GDP, Case-Schiller, Richmond Fed Manufacturing Index and Consumer Confidence.  I expect that investors, at least those that are working today, are waiting for some direction from tomorrow's (and Wednesday's) data.  Here's today's chart:

Well a quick check on the benchmark bond before I sign off for the day revealed some improvement as it is now up 11 basis points.

What are you doing for Thanksgiving?  Are you traveling or staying home?  Do you have some fun traditions?  Please share in the comments section.  I'm heading to my sister-in-laws to be with lots of family.  Can't wait to see my nieces and nephews and relax with the fam playing games and EATING.  Be safe and feel free to contact me if I can help with anything mortgage-related - I'll have my laptop.  702-812-1214.  Happy Thanksgiving.

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