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Monday, December 1, 2014

Mortgage Bond Market Analysis - December 1st Edition

Happy December 1st - it's the start of the last month of the year.  I hope you had a great Thanksgiving.  It's hard to believe that this year is almost over.  There's only one piece of data this morning - The ISM Manufacturing index came in at 58.7 vs. expectations of 58 and previous of 59.  This is not going to have much of an impact on the benchmark bond.  Black Friday had no economic data points but investors / traders were in the mood to shop as they were buying bonds and pushing the price up 43 basis points to close at 104.36.

The only data point this morning is the ISM Manufacturing index and it came in at 58.7 vs. expectations of 58 and previous of 59.  The Relative Strength Indicator (RSI) is overbought so there is a possibility that traders may decide to take some profits off the table and sell - they need $$$ to fund their gift purchase.  As of this writing, the FNMA benchmark bond is up 1 basis point and is just below the 2nd level of resistance.  There is a plethora of economic data this week including ADP Private Payrolls on Wednesday, Continuing and Initial Jobless claims on Thursday and the employment report on Friday - the latter two usually have the biggest impact for bond traders.  There's other data releases as well but these are the biggest ones.  Here's today's chart:

A final check of the benchmark bond before I sign off shows it even on the day.  Please feel free to contact me if I can help you with anything mortgage-related - 702-812-1214.  Thanks and make today great.

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