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Monday, March 7, 2016

Mortgage Bond Market Analysis - A Quiet Monday

Oil is up solidly this morning and there is no real data to speak of so bonds will take their cue from oil.  On Friday I talked about what might happen if the bond closed at or above the current 1st level of support which was 102.00.  I said that with not much economic data being released that oil and China would be the drivers and that a bond sell-off would just automatically occur; it would take a move higher in oil.  This morning oil is higher and is approaching $40 per barrel and OPEC has set a target of $50.  The RSI is now in oversold territory but that won't matter much if oil continues to move higher.  The trend since last Tuesday has been lower, for the most part.  I continue to recommend locking but if you are going to float, keep a watchful eye on the market and lock on any gains.  The benchmark bond is currently down 13 basis points at 101.91, 1 basis point above the new 1st support level.

Wholesale Inventories will be announced on Wednesday morning and we get weekly Jobless Claims on Thursday along with the ECB policy statement - this could have some impact on the market.  I don't expect any legitimate buying in bonds but a huge sell-off isn't likely either with the weakness in China (and Europe - Thursday's statement from President Draghi could be interesting).   Download my app (top right corner of the blog) in order to stay current on the mortgage bond market and receive rate alerts as well as all of the up-to-the minute economic news that could impact the mortgage bond market.  Contact me if I can help with anything mortgage related - 702-812-1214, 801-853-8720 or  Make it a great day and a better week.

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