Wednesday, December 11, 2013 - Article by: Joe Shamie - First Choice Loan Services -
Wednesday - December 11, 2013, 10:30am ET
Current Trend Direction: Sideways
Float/Lock Bias:LockingCurrent Price of FNMA 4.0% Bond: $103.59, -19bp
Lawmakers on Capitol Hill reached a bipartisan 2-year budget deal last night that would avoid another government shutdown. It looks like it will be approved, and the prospect of some clarity is weighing on Bonds a bit so far today.
At 1:00pm ET, the Treasury will be peddling $21B in 10-Year Notes and comes on the heels of yesterdays solid 3-Year Note auction. Otherwise, there no other economic news on the docket for today.
As longtime readers, you know we always like to float until the Fed Meeting just to hear what is said and see the subsequent Bond Market reaction. The problem? The technical picture for Bonds is not good and the Fed Meeting and Statement is still one week away.
We see the Fed tapering in March the earliest and the taper will be modest this just to appease the dissenters. This means Stocks are probably going higher. Couple that with the potential clarity in Washington, and you have the recipe for lower Bond prices.
Consider locking with prices near a ceiling and looking very vulnerable.
Joe Shamie NMLS # 241432
First Choice Loan Services NMLS # 210764
First Choice Bank NMLS# 177877
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