02 Dec Alert To Lock!
Markets opened today seeking direction for the last month of the year with stocks slightly lower and bonds flat. However, the ISM Index came in better than expected, and that has brought stocks back to even and pressured mortgage bonds lower. This is a week packed full of economic reports, with Friday giving us the ever important monthly jobs report. mortgage bonds are at the bottom of the channel sitting right on the 100 DMA for the moment.
It would be a positive sign if prices hold at this level, but a break below here would pressure rates towards the September highs. Given the day’s weakness in the market, it won’t take much for bonds to break below support.
It’s like a weight sitting on wet paper towel. If the weight is heavy enough it will eventually break through. We will suggest locking on short term transactions.