Lender411.com Articles Mortgage Rates

Link to this page Print RSS  

Tuesday - February 7, 2012 8:45am ET

Current Trend Direction: Sideways to lower near-term

Float/Lock Bias: Cautious with bias towards Locking short-term (days and weeks), Floating longer-term

Current Price of FNMA 3.5% Bond: $103.75, -6bp

"I can't quite understand why we need a few more days" German Chancellor, Angela Merkel on unresolved Greek negotiations.

That quote says it all as private creditors, Greek and European Officials are still negotiating the bond swap deal necessary for Greece to receive aid before a March 20 Bond must be paid off. The time is running out on these negotiations and we hear that a formal deal must be presented by early next week in order to do all get through the processes needed to meet the March 20 payment. The chance of Greece leaving the Euro has gone up.

Back here at home, Fed Chairman Ben Bernanke will testify on the economy before the Senate Banking Committee at 10am ET. The question and answer session could be a market mover.

The Treasury will unload $32B in 3-Year Notes today. It should not be a surprise to see this short-term auction do well with so much uncertainty coming out of the Eurozone.

We remain cautious in the short-term with a bias towards locking. The Bond is making a series of lower highs since being pushed back from a ceiling of resistance a few days ago. If this trend continues, the Bond may drop down to test support at the 25-day Moving Average in the near-term.

Longer-term - the trend is still our friend. The Rising Support Line and all of the key Moving Averages remain in a nice uptrend. So looking out longer-term there is no panic to lock as long as these aforementioned support levels hold.

Link to this page Print RSS