The past 3 days, the Resistance top has held steadfast, now creating a double top, which is even more difficult to move through. Where as sometimes rates will stay and linger at the top before pushing to the next level, today's indication is that there is still enough doubt in the world's economy that rates will soon again be heading back towards the 3.75% to 4% range from it's current rate of 4.25%, thereby creating a continuation of a low interest rate environment. Perhaps the world economy had nothing to do with it, and instead the FED stepped in these past 2 days to once again prevent a selloff in the rate. That kind of information is never shared. These indications are valid regardless if you are buying an Oregon Home Loan or a California Home Loan.

It is so interesting that mortgage interest rates are still tied to the 10 year bond. Understand what is happening to the bond and it is easier to predict where interest rates are heading. By the way, it does not matter if you are seeking an Oregon Home Loan or a California Home Loan, the 10 year bond affects all loans.

During the 1st week of November, interest rates hit a high point at 4.25%. From then until now, the 21st of March, rates moved up and down and eventually landed at its low point of 3.875%. However, these past 10 days, people started to sell the bond and invest elsewhere, and when that happend the interest rate started to rise.

On March 20th, the interest rate returned to the 4.25% high of November 1st and what happened on March 21st; the interest rate started to fall and it fell pretty significantly. Why did this happen? Because those that bought at the low of 3.75% sold at the November high of 4.25%. This simplifies the process, but is good enough for this blog.

It was a classic case of buy at the low point of the range and sell at the top of the range - a classic day trading strategy.

Now that rates dropped with the selloff at the high, it remains to be seen just what the rates will be doing in the next few weeks and months. If the March 20th high sticks and rates do not go higher, there is a good chance that the range since November 1st will continue, and we could see rates return to 3.875% - eventually.

If the bond breaks through the March 20th high (which created a double top with the November 1st high), after this pullback, then a new range higher is possible, with the March 20th high turning into the new low, and the next high point determined at a later date.

I think that most of this will depend on the earnings season that is soon upon us. If stocks show good gains and project strong future earnings, rates will probably go higher. If they show stagnation, there is a good chance that the 3.875% to 4.25% range will hold for the near future.

However, this does not take into account a few unknown variables. First how long will the FED continue to help subsidize  the bond market to keep rates low and how badly is the situation with the European Union. These two factors will also have their share of input into what happens to rates.

The Nine Most Important Rules when Applying for a Mortgage

Do not change jobs, become self-employed or quit your job.

Do not buy a car, truck or van.

Do not use charge cards excessively or let your accounts fall behind.

Do not spend money set aside for closing.

Do not stop making your mortgage payments while waiting for a refinance to go through.

Do not agree to have your credit be run.

Do not make large deposits, cash or otherwise, into your savings or checking account unless it is from your paycheck(s) or you can verify their source. 

Do not change bank accounts

Do not co-sign for a loan for anyone.