Bulls and Bears fighting for control

Happy Friday to you. Mortgage bonds are enjoying a nice ride this week. Rates have improved over the week and today with ecomonic news that has been bond friendly. Currently mortgage bonds have pushed above the 25-day moving average and are doing battle at the 200-day moving average. If the Bulls can push bonds up through the day and close above this important level we may see better rates for the weeks ahead. I am not confident the Bulls will be able to close out the day strong enough to close above the 200-day moving average. If you are currently in contract to buy a house or have made application and not yet locked I would recommend you contact your broker toward the 3pm hour to see how the battle ends. If the market closes below the 200-day moving average I would recommend locking in your rate. If it does close above the 200-day moving average it may be worth waiting to see if the trend can hold next week when the market opens up again on Tuesday.
The Fed is also meeting on January 27th. In this months meeting I am sure the Fed Presidents will discuss the extention of the current Mortgage Bond Purchase Program. Many of the Fed Presidents have voiced their support to extend this program to keep rates low for a longer period than the current March 31st end date. IF the Fed can get enough presidents to vote in favor of this and get the money to make the program viable going forward we could see rates stay low further into 2010 which would be good news for home buyers and the housing sector.
The banks are all closed Monday in observance of MLK day. I hope you will take some time on Monday to read some literature from MLK and listen to his message on how we should each treat our fellow man. In that message I would also encourage you to take a moment and pray for those in Haiti dealing with the disaster that occurred there. In addition to your prayers there is a real need for funds to help people in that country. Please donate funds to www.worldconcer.org or a similar charity that is doing good work there in the wake of this tragedy.
Have a great weekend. Rob