There is nothing in terms of economic indicators for investors to chew-on this morning -- so trading action in the stock market will likely be the biggest determinant of interest rate trend trajectory.  Higher stock prices tend to drag mortgage interest rates higher -- while lower stock prices are generally supportive of steady to perhaps fractionally lower rates. 

The desire for cash amid a liquidity crunch has kept Treasury obligations so well bid, particularly on the shorter end of the yield curve, Treasury bill rates have fallen near zero, meaning investors are willing to lend the government cash for the mere privilege of knowing they will get paid back. 

The Treasury Department announced that it will sell $28 billion of three-year notes tomorrow and $16 billion of 10-year notes on Thursday.  That's a larger combined auction than market participants were expecting.  Most observers believe persistent year-end "flight-to-quality" bids, especially for tomorrow's three-year notes, should cause investors little heartburn as they are called upon to absorb this new supply. 

I don't argue the likelihood that the demand for the three-year notes will probably be solid, but from a technical perspective it appears Uncle Sam will likely be required to "sweeten the pot" with a little higher yield in order to attract the required capital at Thursday's 10-year note auction.  If my assessment proves accurate, a higher yield on the 10-year note will likely draw mortgage interest rates fractionally higher as well.

Today's conforming 30 year fixed rate is at 5.375%.