19 Sep The uncertainty continues!
What a ride for the markets yesterday, as the Fed surprised the markets with the announcement of no tapering at this time. Stock indexes celebrated by pushing to their all-time highs again, but the underlying reason continues to be weakness in the economy. That’s based on what the Fed foresees with all of their resources, so it really isn’t a reason for celebration. mortgagebonds rallied with their biggest day since August 2011, stopping right at the top of the trading channel. Today gave us Existing Home Sales, which beat expectations and came in at a 6.5 year high, and the Philly Fed index soared past its expectations as well. After yesterday’s call to float through, we will suggest locking in the gains since we are at the top of the price channel that’s has been in place since June. In the near future, we hope to see bonds claw their way back higher even more. However, continues strength in the economy could increase fears of tapering again and cause mortgage rates to pop higher. The uncertainty continues!