Mortgage Rate Forecast | Going Lower?

A quick post after reviewing the price action on the mortgage-backed securities (MBS) I want to share what I see.

So, what is it?

Well, not to bore you with the nitty-gritty technical details that provide a foundation for what I am predicting but, take a look at the last few days of price action depicted below.  You can see the last four days price is moving horizontal in small daily ranges.

This is occurring after MBS prices have moved back ABOVE their 200 day moving average (depicted in the blue line).  This setup is generally bullish;  meaning odds favor higher prices ahead.

As a refresher, higher prices lead to lower mortgage rates, and vice versa.

Who knows what the catalyst for the move higher in price from here will be?  It might be some news report.  It might be something from the equity markets?  It really doesn't matter but the technical setup is ideal for a move higher.

Stay tuned.

3 Month Fannie Mae 4.0% Coupon (MBS) Price

Brett  Grendahl

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