Locking bias

Mortgage bonds are officially off the channel that has helped mortgage interest rates improve the past couple weeks.  This is a negative indicator
for the near term direction of interest rates.  Unless bonds are able to get back in the trading channel, we can expect a more dramatic downward
move in the direction of bond pricing.  This will push interest rate pricing higher, which is not a welcomed sign.

Initial Jobless Claims for the week ending 4/4/15 were released this morning.  Although they were 14,000 more claims than there were reported the
week prior, the number came in at 281,000, which is still considered a very low number.  The slight increase is coming off of one of the best
weeks we have had in years.  Therefore, the market was happy to see only 281,000 claims.

With mortgage bonds now off the upward trading channel, we will maintain our locking bias.  We aren’t too far away from the 100 day moving average,
which should provide decent support should the market continue to worsen.