Mortgage market Wrap up week of 10/24 - 10/28/11
WOW That is the only way I can start the roller coaster events of this week.
Started off on Monday a little weak from last weeks close. Tuesday came in and in anticipation of the Wed news that was causing fear and panic in traders, I expected to see a hedge against pricing and watch the rates have a slight deterioration. Instead what arrives? A pre-release improvement pointing to a strong Wednesday. Wednesday comes and bonds and treasuries seeing good gains then a couple hours before close a strong sell off of earlier gains occurs. Thursday arrives!?!?! Out of the blue we see HUGE sell off's in the long bonds and watch the FNMA coupon and the 10Y treasury take a massive beating. Between Wed eve and Thur close FNMA coupon lost over 80 bps and the 10Y treasury took a massive -1 21/32 hit pushing its Yields to almost 2.4%. highest marks in appx 2 months.
Today opens with me fully expecting to see more sell off, in an eerily similar pattern that sparked a massive 800bps loss at this time last year and raised mortgage rates over a full percentage point in less than a month. So with these events and signs all appearing to be lining up and what happens today???
A gap up open of +34 then followed suit with an addl +25bps in the FNMA coupon and putting these (FNMA 3.5 coupon) levels back above a very critical hold / support level of 101 and currently sitting at 101.063.
If there is one certainty in this market its this... No matter what you watch, how good you are, how good your information is and how long you have been doing this, anything AND I MEAN ANYTHING can and will happen.
The moral of this story and these very real market events this week is this... when you find the right property or you can save money in your current property you strike while the opportunity exists as tomorrow carry's NO GUARANTEE on rates pricing and if your "great deal" will be there or not.
make it a great close to 2011 and have a good weekend
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