Mortgage Market Recap for the Week Ending 11/07/08

Monday was more of the same from last week, but boy did things turn around on Tuesday!

I’ve been tweeting about how lethargic mortgage bonds were - and how I expected the climb up the hill to take a lot longer than it had - and be much more difficult.  I was thinking it would take a prolonged climb with checks of support along the way.  I was wrong.

Look at the chart below at how wrong I was. Tuesday was the breakout day - with bonds jumping from support and crashing through critical resistance at the 100 day - 25 day - and most importantly the 200 day moving average. A very happy move for mortgage rates - which was essentially sustained for the balance of the week - with mortgage bonds happy to move between resistance overhead at $101.71 and support at the 200 day moving average (at $101.31). The bad news Friday was a closing price 3 basis points below the 200 day moving average. With the horrible jobs report on Friday the tendency would have been for mortgage bonds to rally. All eyes on tomorrow to see what the market does!

30-year fixed rate mortgages closed the week at 6%.

Thanks for reading!

I’ll post back soon,

Ken