Do Mortgage Rates Track with Fed Funds Rate or 10 Year Treasury Bonds?

Below are two charts that track the average conventional conforming mortgage rates.  The first chart tracks the average conforming mortgage rate from 2000 to 2005 against the Federal Funds rate (the overnight rate of interest at which Federal funds (non-interest bearing deposits held by member banks with the Federal Reserve) are traded among financial institutions) for the same period.   The second chart tracks the same average conforming mortgage rate from 1970's to 2001 against 10 year treasury Bond.  The charts are not quit from the same period but they will highlight a what key indicator to use to track mortgage rates. 

When you compare the average conventional conforming mortgage rates against the Federal Funds rate, there  is no direct correlation between the two graphs.  But, when you compare the average conventional conforming mortgage rate against 10 year treasury bond, there is an almost direct correlation between the two.    If you are tracking mortgage rates, pay close attention to how the 10 year treasury bond yield moves!