Bryan Flynn Central Mass and Worcester Mortgages

On a technical note, mortgage bonds are down 5 straight session at 216 bps points....rates have rose to the 6.625% area on a conventional 30 year fixed. Bonds are oversold, which generally indicates that the buyers will be back and drive prices back up. When bonds drop suddenly they have a tendancy to retest half of their loss so in this case upside of above 100 bps...there is no guarantee and a lot with have to do with what the future economic indicators say, but technically it hopefully will happen

That being said bonds are trading high by 28 bps going into the retail sales number.

Non-farm payrolls estimated -60,000 actual -49000 (better than expected...good news for the economy bad for mortgage rates)

Unemployment numbers estimated 5.1% actual is 5.5% (huge jump of .5% last time this happened was in 1986.....THIS IS A HUGE NUMBER PROBABLY CATCHING UP TO WHATEVER EVERYONE WAS EXPECTING)

Unemployed workers surged by 861,000 last month. There are now 8.5 million unemployed in the US.

We are still not technically in a traditional recession but seem to be in growth recession with rising unemployment with not enough grow to accommodate new workers coming into the labor force.

Mortgage Bonds prior to these numbers were down 25 bps on the day and in a down trend.......with those number bonds are now up 9 bps........the dust has not settled with these number....wait and see rates in an hour or so and I will update.

I feel I am not alone to think we are in a recession, regardless of what the numbers actually say, this time last year it was an entirely different feel.....agree? disagree?

Mortgage Bonds are down again today after breaking through the 200 day moving average yesterday afternoon. Initial jobless claims where lower than expected this morning and the umemployment rate is released tomorrow and given the inconsistentcy of this number recently we will remain in a LOCK. Should be a big market mover tomorrow. Stay tuned....

Mortgage Bonds are trading lower this morning and surprise, surprise they are sitting right on the 200 day moving average. On Monday bonds broke through and closed above the 200 DMA and did trade below it yesterday but closed in positive territory at the end of the trading day. Technically yesterday was a bulls v. bears struggle because of the wide trading range so it could be another day of uncertainty in the mortgage bond market.

Productivity and ISM Index both came in better than consensus and stocks have been down over the past few days so I expect a weaker bond market at least this morning.....if you took advantage of yesterday's reprice and locked you are in good shape, otherwise it is a wait and see what bonds do at the key level.

Unemployment numbers to be released Friday which should see some big revisions to last month's numbers, expect the markets to move.

Mortgage bonds are trading -6 bps this morning with no economic data on the docket for today. Fed chairman Bernanke is speaking this morning about the economy and he could move markets, other than that bond trading will be driven by the stock market (stocks up bonds down vice versa)

Bonds did close above the 200 day moving average yesterday and if those levels can hold today bonds rates should be trending lower for the next few days. Some employment, productivity and manufacturing numbers are to be released tomorrow that could sway the markets, but for now I recommend a FLOAT as we still trade above the 200 day moving average.