Mortgage Market and Rate Direction for week of 6/13/11

This week is PACKED with market driving news releases and should prove to be significant in making a larger move than typical, in both good or bad direction, depending on the data.
The releases for this week are as follows...

1. CPI
2. Retail sales
3. PPI
4. Business Inventories
5. NAHB Housing
6. Empire Manufacturing
7. Capacity Utilization
8. Building Permits
9. Philly Fed
10. Michigan Sentiment

Probably the biggest 3 divers in this group are the CPI, PPI and Retail sales numbers BUT lets face it we are in strange waters right now and there is a lot of emotion and fear still driving the markets so dont get caught up in those alone. If Michigan Sentiment comes out weak or strong that could make a strong signal as well and Building permits can do the same.

Since none of this starts until tomorrow I think we will see today's trading in a fairly tight window awaiting the rest of the weeks potential storms. FNMA 4.0 Coupon in the 100.75 - 101.00 area. 10Y yields in the 2.95-2.97% area.

Stay positive, regardless of direction of rates, people still need housing and prices are EXCELLENT and affordability still at 50 year highs! 

If you have questions on rates. markets, investment property investing/strategy, or are looking to buy a home or refinance the one you already own in Colorado please feel free to call or email me.



David Shamansky
US Mortgages
8 Inverness Dr E Suite 260
Englewood, CO 80112
720-524-8020
NMLS#245170
Equal hosuing lender
* above commentary is my own and does not guarantee any rate or market direction. It is based from news and data both in the US and globally as well as what is pending to watch for.

Mortgage Market Direction 6/10/11

Mortgage Market Direction 6/10/11
The storm, before the calm, before the storm?

This week appears to have shaped up, especially last couple days, to be the storm, before the calm, before the storm.

We have had some serious movement, over the last 2 days, on very weak driving data (that's the storm round I). An overheated equities market showing a large 150(ish) point retracement from its folly or exuberance and unfounded gains yesterday and the 10Y yield is back down to the 2.95% mark again.

What does all this mean?

Likely today, and even Monday, could be the calming of the overreacted movements in the markets that caused some who did not lock correctly, to lose over 1/2 pt in pricing or an 1/8th (.125) in interest rate increase.

Next week we have retail sales and CPI numbers being the major market movers. If those results are what I believe they will be, as all else is weak right now, we should see another spark (storm round II) for interest rate improvement.

Have a great weekend and if you are interested in property investing in Colorado, have questions on markets or rates, looking to purchase a home in Colorado or refinance the one you have and take advantage of incredible low fixed rates please call or email me.



David ShamanskyUS Mortgages
8 Inverness Dr E Suite 260
Englewood, CO 80112
720-524-8020NMLS#245170
Equal housing lender

* above commentary is my own and based on techincaldata and news from both US and global markets and does not guarantee any direction on markets or rates.

Rates are in a testing pattern today 6/3/11

With the employment numbers including non farm payroll coming in below expectations today it sparked a massive +47bps gap up opening. However our last 3 weeks of almost non stop increase to bonds and treasuries may be at a check point before we see further rise.

I say this as the bonds with no additional news to change took an almost immediate -22bps swing back down and yesterday closed about 25bps below the low mark I expected to see.

Does this mean the rally for bonds is over?

No, it simply is a normal pattern that anything with a long trend upward or downward has points where the markets tests its direction to ensure it is moving properly.

So with that said I think today (also being Friday and these are normally not major market mover days) we trade close to the 101 range on the FNMA 4.0 and I still believe once we pass this test point we should see bonds rally upward.

Bottom line is... prices are low, rates are lower and NOW is an excellent opportunity for both first time buyers as well as move up buyers to get a lot of house for the money!

If you have questions on financing, products, rates investment properties or investment property strategy please feel free to call or email me.



David Shamansky
US Mortgages
1745 Shea Center Dr 4th Floor
Highlands Ranch, CO 80129
720-524-8020
NMLS#245170
Equal housing lender

*above commentary is from my personal review of market driving factors and news in the US and globally but does not guarantee any direction on rates and market movements

Mortgage Rates and Markets 6/2/11

Good morning readers and members.
The market opened up today with a slew of bad news. (should bolster lower rates)
here is what is driving the markets today...

Initial Claims: Actual 422K, prior 424K (consensus 413K) Continuing Claims: Actual 3711K, prior 3690K (consensus 3688K) Productivity-Rev: Actual 1.8%, prior 1.6% (consensus same as prior) Unit Labor Costs-Rev: Actual 0.7%, prior 1.0% (consensus .9%) Factory Orders: Actual -1.2%, prior 3.4% (consensus 1.0%)

• Initial claims are down a touch but actually up almost 10K from the consensus number
• Continuing claims are up almost 25K from consensus
• Productivity is up .2% (not a good sign as that ties directly into why claims are higher productivity is going up meaning more is being done with less people)
• Labor costs down .2% from consensus number (meaning incomes are falling a touch)
• Factory orders are WAY off over 2% from consensus numbers!

The markets are finally starting to react in patterns expected with this news. I think we still make significant runs upwards from here and tomorrows employment numbers should drive that home
.
Currently the FNMA 4.0 coupon is trading at 101.125 down slightly from its close yesterday.
I expect today's trading range to be between current levels (I believe we are at bottom now) and potentially 101.35. However in a longer trade range I still believe we will break through 102.


Lock advice

if closing in 14 or less - lock (likely this afternoon to get a little benefit from improvement)
if closing in 15+ days - float markets are poised for further improvement

If you have questions on rates, markets, improving your current loan, taking advantage of investment properties or investment property strategy please call or email me. If you are an AR reader member, as always fell free to call or email me.



David Shamansky
US Mortgages
1745 Shea Center Dr 4th Floor
Highlands Ranch, CO 80129
720-524-8020
NMLS#245170
Equal housing lender

* the above commentary is my own opinion based on news, events and indicators both in the US and globally and does not guarantee any movement up or down in the markets.

Mortgage Rates to improve 6/1/11

Mortgage Rates to improve!

Good morning to all and happy Wednesday.

Overnight market was relatively quiet until this morning release of ADP payroll report showed the increase was a dismal 38,000 in April. That pales in comparison with the expected increase of 170,000 private payrolls (which was actually reduced down from initial expected number of 177k). Bonds jumped as did the 10Y by a staggering number after this. This morning gave us a gap up open of +22bps and treasuries are at +22/32 putting yields below 3% on the 10Y for the first time in almost a year!

Adding to this major shift is the manufacturing sector that's down with a big contributor from the high prices of oil and reduced orders and sketchy supply chain and housing still way off with no clear exit strategy in view and we have a very interesting dilemma. QE2 is still in place, and active as we speak, yet it is not bearing any fruit? Is this a recipe for QE3 and if so what is that going to look like and cost?
We are nearing the 4.0% mark for 30yr fixed rate mortgages and yet MBA posts a 35% decline in mortgage applications?

In a non interest rate topic I expect to see a SHARP sell off in equities and likely further improve rates but how much more can they lower seems to be the question?

I think we see today's trading range very high from this, maybe in the arena of 101.35-101.50 (FNMA 4.0 coupon)
I think we see the 10Y settle down now and close UNDER 3% keeping it close to this mornings levels of 2.97%

Lock Advice

If your loan is closing in 14 days or less - float until this afternoon then lock
If your closing is over 14 days - float (we have more improvement to come)


If you are looking to buy a home in Colorado, enter into investment properties, or seasoned in investment properties and looking for more call or email me.
We allow up to 10 financed properties, fix and flips and more.


David S
US Mortgages
720-524-8020

*the above commentary is not a guarantee of performance nor a guarantee of interest rate movement. It is solely based on US and global indicators and indicates a likely direction rates will head.

Mortgage rates cautious ahead of critical data

Mortgage Rates Cautious ahead of critical data

Good morning insighters...
Today opens flat after our long weekend with the FNMA 4.0 coupon opening 3bps under Friday's close and since has lost another 3bps. Fridays close was exactly in the range I called fro on Thursday and ended 25bps below the Thursday close. There is a lot of data to dissect this week but the biggest comes on Friday being unemployment. Here are the weeks driving news...

Tues 5/31
Chicago PMI
Wed 6/1
ISM Manuf.
Construction
Thur 6/2
Productivity
Fri 6/3
Employment

Now we see a slightly different pattern than recent trading and the FNMA coupon has not followed along the 10Y note path. The 10Y is at its early December 2010 lows with its yield at 3.06.
Based on Greek issues and the restructure that has to occur as well as data that reflects, we are not out of the woods yet, I believe the FNMA coupon will see some gains. What concerns me is we should have seen an open up gain but I do realize while its Tuesday we are only a few hours into this weeks session and a lot is left to come.

Lock Advice
if closing in 7-10 days - lock
if closing in 14+ float

Mortgage Rates likely flat to slight decline today 5/27/11

Mortgage rates likely flat to slight decline today 5/27/11

Good morning.

We had an extremely good day yesterday for rates with the FNMA coupon gaining +53bps for the day.
As I expected and posted don't panic from today's early losses as it is expected (profit takers and holiday weekend). The bonds opened today with a -22bps gap down open and since have retraced +6bps of that leaving the current FNMA 4.0 at 100.688 (still a very strong number). If you read my post from yesterday you will see I said expect a -15 - -25bps loss today so we are right in line.


No major news today, so I expect todays close to be right in line with those figures.

Have a great day and an even better long holiday weekend!

If you have questions on markets, interest rates, a loan scenario or strategy for investment properties please call or email me.




David Shamansky
US Mortgages
1745 Shea Center Dr 4th Floor
Highlands Ranch, CO 80129
720-524-8020
NMLS#245170
Equal housing lender
*above commentary is from my own personal viewpoint and research on US and global economic data and factors and does not constitute or imply a guarantee of interest rate direction.

Mortgage Rates Poised to improve 5/26/11

Today news brings us some likelihood that rates could take a slight improvement (go lower).

GDP -Second Estimate: Actual 1.8%, prior 1.8%
(Consensus 2.0%)
GDP Deflator - Second Estimate: Actual 1.9%, prior 1.9%

Initial Claims: Actual 424K, prior 409K (Consensus 400K)

With GDP numbers coming in a little lower than estimated and seeing the sideways trading pattern we have been in for about a week or so I think we are now poised to see some gains. Today we still have the 7yr auction to confirm this but considering the 2y and 5y went well on Tue and Wed this week we should see more of the same.

Market closed right in the middle of the trading range I called yesterday at 100.25 (FNMA 4.0).

Today brought us a small +6bps gap up and I think we can see us elevate to my called high yesterday of 100.65.

The 10Y is also following suit and is currently at 3.11 yield and we could see that fall to 3.08

Lock Advice

If closing 7-10 days - Lock this afternoon

If closing 14+ - float

Mortgage Rates and Market News 5/25/11

"Good Morning and here is the rate outlook for 5/25/11 abd what is driving the market today...

The bonds closed on a high point yesterday ending the day at +28bps and closing at 100.281 (FNMA 4.0)

Today opened with a small gap down of -9bps as the slightly worse than expected Durable Orders numbers were released and caution awaited the FHFA numbers and 5yr auction for later today. (this should have given us a slight improvement but with an approaching holiday and 5yr auction results not in traders are hedging)

These are the numbers from todays news with only item left of significance to be the 5yr auction.

MBA Mortgage Index: Actual 1.1%, prior +7.8%

Durable Orders: Actual -3.6%, prior 4.1% (Consensus was -2.0%)

Durable Orders ex-Transportation: Actual -1.5%, prior 2.3% (Consensus was .6%)

FHFA Housing Price Index: Actual -0.3%, prior -1.6%

After seeing these numbers I have to believe we should trend in an upward pattern (lower rates) but the main focus will be on the 5yr auction this afternoon. If it goes as expected or better we could hit levels not seen since end of November and would make that best of all of 2011, if not then we could see a sell off between 15-25bps.

I expect today's trading range to stay between the 100.15 - 100.50 levels.

The 10Y also followed suit and is at its 2011 lows yielding 3.09

Lock advice

If closing in 7-10 days - Lock

If closing in 14+ - Float cautiously

Mortgage Interest Rates Likely Choppy Today 5/24/11

Yesterday was mixed with a strong opening and the FNMA 4.0 coupon hitting its intraday high of 100.313 by 11a. After that it was a slow decline to close at its low for the day (not good). Most of this was derived from traders hedging for anything unexpected (this is really common during a week filled with a lot of market driving news).

Today I expect to be cautious/choppy as well but we do start getting some of our news released today with the New Home Sales report as well as the 2yr auction. I am not going to give much weight to the 2yr auction as the time frame is really not a market driver as the long bonds would be (the10y and 30y). However with that said traders will look at it to see if they can glean a direction of the market being bearish or bullish on bonds.

New Home Sales: Actual 323K, Prior 300K (consensus was 300K)

With the New Home Sales numbers being better than expected (but after reading numerous posts on AR I am seeing the same signs of life reflected in these numbers, so not a shocker at all) I think we trade close to where we are today ranging between 100.00 - 100.313. If the 2yr numbers are weak however we could see a sell off and our next logical stopping ground is at the 99.70 mark.

The 10Y is holding similar ground after hitting the 2011 lows of 3.09 Yield it ended at 3.14 Yield.

Lock Advice

If closing in 7-10 days - Lock you have very little to gain and a lot more to lose
If closing in 14+ days - Lock 60% Float very cautiously 40% We could see some rally back towards our highs and beyond but you have to factor the risk versus reward here.

Make it a great day and if you have questions on interest rates, market direction or investment property financing please call or email me.

David Shamansky
US Mortgages
1745 Shea Center Dr 4th Floor
Highlands Ranch, CO 80129
720-524-8020
NMLS#245170 Equal Housing Lender
*Above market news is not a reproduced (cut and paste of someone elses work). It is from my personal subscriptions and reading on US and Global market news and drivers as well as my insight on their likely direction but does not guarantee any movement in one direction or another.

Mortgage Rates Look to Trend lower

Mortgage Rates likely to lower this week.

Good morning and happy Monday to all.

Today brought us the open I called for on Friday. Fridays close at the top of the day and over a critical point of 100 (FNMA 4.0) coupon along with Asia's overnight flight to quality in long bonds are driving this mornings open.
The news is also being pushed by the S&P downgrade of Italy and we also saw, for the first time in 30 years, Spain see a massive shift in voters who fled the Socialist Party and did not re-elect its sitting Prime Minister.

Fridays closing number was 100.156 Today we saw a +16bps gap up open and another +6bps since open. We are currently at 100.375 (FNMA 4.0) coupon and should likely bring us appx .25 improvement to price NOT rate.

The 10Y is also back to its lowest levels since early December regaining all its lost ground from last Wednesday to put the 10Y yields back near its low levels since December at 3.106.
We have some driving news being released this week.

Tues 5/24
New Home Sales
2-yr Auction

Wed 5/25
Durable Orders
5-yr Auction

Thur 5/26
GDP
7-yr Auction

Fri 5/27
Core PCE
Income
Pending Sales

Unless there is some unexpected news from this, I see rates continue to improve slightly and we could get to a point not seen since late November 2010!
The time to make it happen is NOW! Low prices favorable finance rates and requirements (over what is potentially coming based on current talks) give this the best looking window of opportunity top buy a home in over 40 years (based on the affordability index).
If you have a loan scenario or are looking to buy in Colorado please feel free to call me to discuss this and or any strategy you may want to look into for being or extending your reach in investment properties.

David Shamansky
US Mortgages
1745 Shea Center Dr 4th Floor
Highlands Ranch, CO 80129
720-524-8020
www.usmortgages.com
NMLS#245170 Equal Housing Lender
*Above commentary is my personal review and opinion based on facts and data I read daily on both a global and US economic scale. It is not a guarantee on rates improving or declining.

Mortgage rates likely flat today

Good morning insighters and HAPPY Friday!

OK yesterday we covered to strong areas,
1) we tested a low of 99.75 (FNMA 4.0 coupon) and
2) closed at the days high over a critical support level of 100, closing at 100.031

There is absolutely nothing driving today's market in the US all focus is on the Greek debt restructure, reschedule??? whatever they may or may not do. Many traders are looking to short the bonds as they have had a nice long but slow and steady climb over the last month. Carrying a short on bonds will be a tough and very risky call with the Greek debt issue having no solid direction so I think today will see us regain the minor loss and likely close between 100.0 - 100.1 (FNMA 4.0)
The 10Y is doing well and back down from its high of 3.20 to 3.15.

Lock advice
If closing 7-10 days  Float (I believe we have a good week next week as Greek issues will be answered and that should drive more money into the safety and security of our Bonds)
if closing 14+ Float (same as above)

Have a great weekend

Mortgage rates abrupt turn for the worse!

Good afternoon market insighters!

Sorry for the late posting but it has been an extremely hectic day and I am just getting some of the little free time I have to complete this daily update for all.

OK we know yesterday had a very rough close with the FOMC meeting notes release being the driving force. Even though the data was nothing unexpected, it was used as a sell off tool and that did cause the markets to close on a negative note, losing over 44bps for the day at the peak but closed a touch better at -40bps 100.00 (FNMA 4.0 coupon).

Today brought us an equally nasty -22bps gap down open, as traders saw some positive news (nothing earth shattering) but remember I keep saying in this weird market we find ourselves even "slightly" positive news seems to make overreactions as traders try to create out of it something that isn't as it should be (a total overreaction).

Here is the news from today that sparked this early gap down loss...

Initial Claims: Actual 409K, prior 434K (consensus was 420K so a +11k release)
Continuing Claims: Actual 3711K, prior 3756K (in line with consensus)
Existing Home Sales: Actual 5.05M, prior 5.1M (consensus was 5.23M a -.18M release)
Philadelphia Fed: Actual 3.9, prior 18.5 (consensus was 18 a -14.1 release)

So you look at all this and add to it all the happenings for both Portugal, Greece and the not talked about nuclear issues still in Japan and you think "why did we lose 62bps over this"? The answer is... a spin on anything can make a "temporary and quick change" but one that will correct and be short lived. No matter the size of the investor the technicals simply cannot be overlooked and I believe we will rebound from this unmerited sell off.

On a positive note we have started to see some minor retracement from early losses as the Philly Fed number did cause some to rethink their earlier positions - good for rates.


I expect what is left of today to trade between the 99.80 - 100.1 mark. It would be very good if we could break over the 100 line as that will help create a new level of resistance to trade from over the next several days.

The 10Y took a mild hit as well seeing its Yields go from 2011 lows of 3.09 to 3.22 in just a few hours. Since this a slight retracement has occurred here as well and the 10Y is back down to 3.18

Lock Advice -
If closing is 7-10 days Float for late this afternoon or tomorrow as we should see more retracement of losses and an ease to pricing but Lock no later than tomorrow
If closing is 14+ days - Float as we will see rates gain back losses and keep a close eye on the FNMA 100 level. If we break too far below (99.7 or less) we could see another small sell off before it gains back ground.

Its tough out there but we are all in the same boat so be positive and make it a great day!!!

Mortgage Rates Likely Flat Today

Good morning and happy hump day to all the insighters.

There is not a whole lot of news breaking today just the minutes from the FOMC committee, which will provide insight into direction but most agree nothing unexpected will be heard from today's minutes.

Yesterday closed at a high point in the FNMA 4.0 coupon ending the day at 100.375.
The open today brought little change as the coupon was up +3bps but I think may be poised for a slight sell off then retracement in the afternoon. I say this as typically when you see levels near or at their peak and not a lot of driving market news you see the profit takers selling off and that usually forces the coupon down until the technicals and patterns of the 10Y (which are closely matched) either push them off further or bring them back in line. Since the 10Y is at 6 month lows on Yields (meaning lower interest rates) my belief is we will see a sell off of some magnitude maybe at or close to -25bps and should regain most or all of it this afternoon.
The 10Y is now below 3.11 for the first time since early December and currently sitting at 3.109. Two critical support levels for this are the 3.07 and 3.00 mark on the 200 day moving average. Based on us breaking through the 3.14 mark I believe we will get to the 3.00 soon.

Trading range - I expect today to trade between 100.15 - 100.45

Lock Advice

if closing 7-10 days - LOCK (we are at the top of the range so the sooner you lock the better)
if closing 14+ days - Lock/Float cautiously (we are at our high levels for today so no need to test but the longer term picture should bring us some improvement to rates)

Remember... YOU are the professional and your connections, knowledge and dedication sets you apart from others. If you need more connections go make them or use your current ones for introductions. If you need more knowledge read about your industry and events that shape it. If you aren't dedicated its time to take this seriously as the tide is shifting.

Make it a great day and do something to improve yourself!

Rates look to Improve

Good morning and Happy May 17th Insighters!!!
Today was not much of a shocker on the news front. Builders released the housing data and the only real disturbing piece is the fact its even less than the appallingly low estimates!
Here is the data results driving the markets in our favor…
Housing Starts: Actual 523K, prior 549K (-40k from consensus)
Building Permits: Actual 551K, prior 594K (+39k from consensus, this is the only bright star)
Industrial Production: Actual 0.0%, prior 0.8% (-.5 from consensus)
Capacity Utilization: Actual 76.9%, prior 77.4% (-.8 from consensus)
So the hope is that builders are starting to see some light at the end of this very long tunnel, as the permits pulled did go up from expected levels, however when you look at the actual starts (which puts people back to work) those are lagging behind almost the same number the permits are up.
The 10y responded very well and seeing what ”should” bring us to the 3.00 levels as we finally broke through a critical mark at 3.14 and are sitting at 3.11.
Yesterday had the FNMA 4.0 close at the top of the range and today opened with a nice gap up +12bps open.
Greece and Spain now appear to have their debts extended to avoid a default.
Is the US next in line? We might laugh at the thought today but reality is we have a serious deficit that is not going away anytime soon and per the congressional budget office we will have reached our max borrowing limit in August of this year!
Hold on its going to get interesting but for now all of us in the real estate world should benefit nicely from these extremely favorable rates!!
Trading range today I expect us to break through the FNMA 4.0 level of 100.5 and close in the 100.5-100.65 area.
Lock Advice
If closing in 7-10 days – LOCK, take your gains and move on
if closing in 14+ – Float, rates will get slightly better (at least that is what current technicals point to)
Make it a great day

Rates poised for further improvement?

In a very interesting play the Asian market has been putting strong bids in on bonds in overnight trading since the news release that IMF Director Dominique Strauss-Kahn was jailed for sexual assault. This puts more doubt into any further Greek debt restructuring and we are now at the lowest levels for long term rates since late November 2010. We are on the verge of breaking through a critical hold point to see "potentially" further decrease to rates. The 10y is at 3.18 but if we break through our closely tested 3.14 we could see the yields drop to 3.00. The FNMA 4.0 closed on Friday at 100.125 and opened today relatively flat at -6bps and have gained back +3bps since opening bell.
Today does not have much for news, since the release of the Empire Manufacturing Index
Empire Manufacturing: Actual 11.9, prior 21.7 (consensus 18)
and I see another day of range bound trading.
I estimate the FNMA 4.0 coupon to range between 100.00 - 100.28

Lock Advice...
if closing in 7-10 days - LOCK
if closing in 14+ days - float cautiously

Fri the 13th is good news for Mortgage Rates

Good morning and happy Fri 13th Insighters!
Yesterday had a weak close near bottom of the range but was still over a critical threshold keeping the FNMA 4.0 coupon above the 99.80 mark, close was 99.906.
Upon anticipation and subsequent release of the CPI numbers today we have seen a nice retracement of losses and are currently at +34bps (100.25).
Here are what the numbers reported…
CPI: Actual 0.4%, prior 0.5% (consensus was .4%)
Core CPI: Actual 0.2%, prior 0.1% (consensus was .1%)
Michigan Sentiment: Actual 72.4, prior 69.8 (consensus was 69.5)
I like seeing the Michigan Sentiment numbers come in higher, however, I am much more concerned that if you look at the overall economy on a global scale you see very disturbing issues.
Portugal – 2nd straight 1/4 posting losses (GDP -.7%)
Euro – is in turmoil and (as most partnerships) when 2-3 of them pull the weight of all the others you can see why Germany wants to leave, as the union with Euro is hurting them as well as France (both are doing well and the Euro is hurting them both)
Greece – still a mess and combined with Portugal’s recession and issues in Japan and Middle East there is as much reason for concern as there is exuberance. This is partly why you see DOW in the mid 12,600 range and rates still low. (other obvious factors include the feds buying our own debt and keep rates artificially lower than they should be, to help stave off even deeper issues that would come from higher rates right now).
Anyway as far as todays trading goes I see us near top levels now and likely see today close between the 100.15 – 100.34 mark (FNMA 4.0)
Lock Advice…
If closing 7-10 days – LOCK we are near top levels no need to risk
If closing in 14+ – Float cautiously BUT (I dont see a lot of upside in 10-14 days to offset the risk/reward)
Have a great weekend!

Mortgage Rates Poised for Downturn?

Good morning Insighters and happy Thursday...
Well as seemingly commonplace lately, all the action anticipated takes place before relevant news and the actual news brings us little to nothing. We saw a pretty volatile 2 days (afternoon session on Tue and all day Wed) see large movements in bonds from -68bps to a retracement of +44bps in anticipation of today's release. And what did all this bring us?
basically nothing! Here is the data driving today's markets.
Initial Claims: Actual 434K, prior 474K (consensus was 423K)
Continuing Claims: Actual 3756K, prior 3733K (consensus was 3700K) 
PPI: Actual 0.8%, prior 0.5% (consensus was 0.5%)
Core PPI: Actual 0.3%, prior 0.3% (consensus was 0.2%)
Retail Sales: Actual 0.5%, prior 0.4% 
Retail Sales ex-auto: Actual 0.6%, prior 0.8%
The markets today are relatively flat after the release of these numbers.
The FNMA 4.0 coupon closed yesterday at 100.156 (up from its intraday lows of 99.719)
Today we opened -3bps and currently sitting at -6bps. The talk of concern is the very small yields being gained from the bonds right now as they are at 2011 lowest levels. Some traders were caught off guard from the last 3 weeks rally but my concern is will this be sustainable or are we to see some sell off appear in the days ahead?
I expect today's trading range to land between the 99.8 - 100.25 levels.
Only significant event to drive in either direction is the feds 16B auction of 30y notes this afternoon. Traders are anticipating a strong buy for these to follow suit as the 10y went yesterday. If this occurs we could see us near the top of the range.

Lock Advice...
If closing is
7-10 days - LOCK
14+ days - Lock you can float but I think risk far outweighs any potential slight gain
Make it a great day and use the last 2 days volatile swings to push your buyers off the fence and get them moving while rates are still favorable and at 2011 lows!

Hedge and treasury gains

Today brought us a very heavy - 37bps gap down loss. Some of this driven from the strong dollar some of this from fear of better than anticipated numbers in tomorrow PPI release and some of it from better than expected results in the economy. After yesterdays -31bps we were facing a critical day as this was a large sell off prior to the release of real driving numbers from PPI & CPI. Today retraced all of its opening loss as investors used higher valued dollar along with treasury security to make the buy into bonds.
Hold on for tomorrow another wild day could be upon us.

neutral

Today looks to be a repeat of yesterday with bond prices and 10y Treasury yields relatively flat in anticipation of Thu and Fri PPI & CPI numbers.
Yesterday closed at 100.469 (FNMA 4.0 coupon) a +12bps for the day but consider we opened with a -6bps the day had basically no movement. Keep in mind the pricing levels as most are switching their watch now to the FNMA 4.0 instead of the 4.5 coupon so do not be caught off guard. The difference in pricing on these is appx 300bps so dont be alarmed at the price shown.
Today opened with a small -6gap down and been flat since.
I do not see anything that makes me think we are going to break out of this very tight and light trading range today or tomorrow.
Expected range 100.35 - 100.5

Lock advice
if closing in 7-10 days - LOCK
if closing in 14+ float cautiously/lock

Calls today are repeat of yesterday there are no technicals to indicate a change

Make it a great day

Interesting week ahead

Good morning and happy Monday to all the Insighters...

Well this week has some light (non market driving) news until the end that will likely cause some movement dictated by the results.
Thu has PPI (producer price index) numbers released and Fri is CPI (consumer price index). If these are in line with expectations we will likely not see much change to our current trading levels. However, if there is any significant unexpected results we could see a sharp drive either direction.
Last week the FNMA 4.5 coupon closed at 103.47 its highest trading of 2011. Today brought us a small gap down loss of -6bps but has since retraced those losses and puts us in positive territory at +9bps keeping us at 103.5 that I called for last week.
We have seen a nice steady few weeks of gains so do not be surprised if we see some sell off from profit takers and between now and Wed eve I dont see a whole lot of room for upside.
Thur and Fri will be driven by PPI & CPI.

Lock advice...
If closing in 7-10 days  LOCK too much risk out there if PPI & CPI come in strong
If closing in 14+ (float cautiously/lock) I give this as mixed as it truly is a coin toss and either decision is OK if Wed approaches and we have another 20bps in gains then LOCK and protect your pipeline and clients

Make it a great week

Profit Takers or True Technicals?

Good morning and HAPPY Friday Insighters...

With some better than expected numbers released today the bonds gave back almost all of yesterdays gains in a large gap down open of -31 putting the FNMA (4.5 coupon) back down from its 2011 highs to 103.128. Here is the data driving this opening bell sell off.

Nonfarm Payrolls: Actual 244K, prior 216K (consensus was 185K) net gain realized +59K

Nonfarm Private Payrolls: Actual 268K, prior 230K (consensus was 200K) net gain realized +68K

Unemployment Rate: Actual 9.0%, prior 8.8% (consensus was also 8.8%)

While the numbers of jobs created in non farm payrolls is a better than expected number, the reality is we are still so far short of what is actually needed for job creation when you factor in the number needed to sustain growth and all the new arrivals into the labor markets we are still barely at 60% of the jobs needed. This is supported from the above data that shows better than expected jobs created with the unemployment number still rising.
I believe we will see some retracement to the opening bell sell off, once the substance of this over reactive move is digested and I expect today's trading range to be between 103.128 - 103.35 (FNMA 4.5).

Lock Advice.
If closing is 7-10 days - Lock this afternoon when some of the losses should be retraced
If closing is 14+ - Float cautiously as we should see next week bring us at or above the 103.5 level

Bullish on Bonds

Good Morning and Happy Thursday to all the "Insighters"...

It appears the calls for this week were spot on but 1 day late in arrival. We closed yesterday over a critical ceiling and the FNMA 4.5 coupon broke through 103 closing at 103.063. As I called for breaking through that would likely lead to a nice rally and we opened this morning with a +21 gap up! The driving factors behind this are...

• Initial Claims: Actual 474K, prior 429K (the consensus number was expected to drop almost 30k not go up almost 50k)
• 
  Continuing Claims: Actual 3733K, prior 3641K (actual also higher than consensus)
   
• 
  Unit Labor Costs: Actual 1.0%, prior -0.6% (revised -1.0%)

The market is poised for a nice run up now for the next several weeks and I believe we will see the 103.5 broken through in the next week+ and could potentially see 104 (FNMA 4.5 Coupon) before the end of this month, barring any unexpected news release. The 10y is now at its lowest level of 2011 and yields are +8/32 putting it at 3.18%.

I see today's trading range to likely be at its gap up open since we are in territory not seen in months. 103.00 - 103.3 is the range I expect today and will likely close in the 103.1-103.2 section of this.

Lock Advice.
If closing in the next 7-10 days - LOCK (pricing is excellent and there is not enough upside in this short term window to take the risk)
If closing in the next 14+ - FLOAT (I believe we can see another .25 -.5 in pricing gains during the next 2 weeks and this will give your bwrs lowers rates)

Make it a great day and remember... THIS IS THE MOST AFFORDABLE TIME IN 40yrs TO BE BUYING A HOME!! Get your buyers off the fence!

Mortgage Market Insight

Happy humpday Insighters!
Today has a little news being released but all in all probably not major market movers.
Today we have…
MBA Mortgage Index: Actual 4.0%, prior -5.6%
Challenger Job Cuts: Actual -5%, prior -38.6%
ADP Employment Change: Actual 179K, prior 201K
ISM Services: Actual 57.5, prior 57.3
The MBA data is a result of the flood of applications taken to beat 4/1/11 and likely will see the next report in the loss column as refinance applications are way down. The ADP report is never accurate, so very little weight, if any at all, will be given to it.
With ISM Services showing improvement and Challenger job cuts improving you could see us at the top of the market today. Not hitting 103 yesterday (FNMA 4.5) is a bit concerning, however we did not miss by much closing the day at 102.969. Today opened -3bps and has remained there. I urge caution today. We have had a nice series of daily gains and flattened out some yesterday. Overnight trading was improved but profit takers sold off to push yields up from overnight lows of 3.24% to 3.27% (10y).
I believe we will see today's trading range between 102.8 – 102.97 (FNMA 4.5 coupon). Its a very tight window, so be careful, breaking through either level could cause a sparked sell off if on the low or a nice rally if to the high.
Lock advice
If closing is…
7-10 days – Lock (as yesterday too much risk/reward and we look to be at top of range today)
14+ – Float cautiously (if we hit and break through 103 you will likely see a nioe rally to lower rates if we fall below 102.8 we could fall back down to 102.5 levels).

Real Estate Marbles

I decided to move my blog over from its current location at real estate marbles to blogger.com to expand its reach and also provide critical insight to those looking for accurate advice on the consumer level as well as the industry users.

Each day I provide an insight to what is driving the markets, expected trading ranges, locking advice and tips. Feel free to visit www.realestatemarbles.com/groups/market-insight to see my daily predictions and check for accuracy. You will not be disappointed.

I have been in the mortgage industry since 1993 and have an extensive background in marketing, sales, trading patterns / hedging for both retail and wholesale lending and buidling and running mortgage platforms both retail and wholesale.

I hope my years of insider knowledge and accuracy in daily market calls helps others better plan their lives, with respect to the mortgage world, for consumers and business alike.