Preparation to lock is critical

Markets are starting the day with stocks and bonds both moving higher, even after Consumer Confidence was lower than expected.  It’s likely that investors are interpreting that QE3 will continue on, despite the uncertainties around the world and those in Washington.  mortgage bonds are continuing upward, and are attempting to break above the 100 DMA.  That would be the first time since early May, and would result in pressuring interest rates lower.  The bond market has auctions to contend with today, so we will start with a cautious floating bias.  However, given that we haven’t been at these levels since mid-June,  be prepared to lock in as bond prices have notable resistance just overhead.  This is most definitely a place where you should exercise extreme caution if choosing to float your rate.  Preparation to lock is critical.