Continued locking bias

Markets are starting this week with no economic reports until Wednesday, when we will see Existing Home Sales.  More importantly, the Fed Minutes will be released on Wednesday as well.  Investors will scrutinize the report for any indication of tapering off bond purchases, or a general shift of sentiment from dovish members.  Stock Indexes are close to even for now, but the S&P 500 has closed higher for 4 weeks in a row.  mortgage bonds opened higher, but have backed down to negative territory already.  This is the 5^th day of testing this price level.  There is room to fall about 50 basis points from here, which would match the mid-March lows.  Should this happen, we will be back to the highest rates have been so far this year.  Still, those rates are typically well below 4%, depending on your scenario.  With the bond market falling, and given the trend of late where bonds begin the day strong and fall negative, we will continue our locking bias.