Wednesday - April 23, 2014, 1:25pm ET

Current Trend Direction: Sideways to higher

Float/Lock Bias: FloatingCurrent Price of FNMA 4.0% Bond: $104.31, +22bp

Despite a big rally in the Stock markets this week, Mortgage Bonds have held up relatively well and are trading higher. After last week's sell-off in Mortgage Bonds, lower prices are luring in buyers. And technically support continues to hold for Bonds.

The current recovery is now 59 months old, the average length of all post WWII expansions. The last three recoveries have been much longer; 92 months, 120 months and 73 months respectively. This recovery will also be a very long one. Inflation remains benign, unemployment is still very high, commodity prices are low, and the Fed hopes to keep short term rates near zero for at least 15 more months.

A mentioned earlier, support by way of the 25/100/200 day Moving Averages continues to hold. Float while Bonds remain Happy. But be on guard in case the Treasury auction sours the good vibes.

Joe Shamie NMLS # 241432

First Choice Loan Services NMLS # 210764

First Choice Bank NMLS# 177877

866-970-3400 x-5135

jshamie@fcbmtg.com