Bond Market Comment

Mortgage Bonds started out the morning down, but have since climbed into positive territory. Overall, however, prices still remain just below a stiff ceiling of resistance at the 200-Day Moving Average.

In other news, Existing Home Sales came in below expectations. Also in the news, the Fed Meeting begins today. Although the Fed Funds Rate won't change as a result of the meeting, there is speculation that the Fed will buy more longer-term Treasuries, which may jumpstart the cycle needed to eventually bring Mortgage rates down.For now, I recommend floating as we watch to see if a continued slide in Stocks can help Bonds improve or if the Treasury Department's auction of 2-Year Notes today will pressure Bonds lower. I will keep you posted.
Leonard Winslow
Dominion Trust Mortgage