Tuesday, May 24, 2011

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.
us mortgages interest rates colorado
David Shamansky
US Mortgages
1745 Shea Center Dr 4th Floor
Highlands Ranch, CO 80129
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.

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