It's Deja Vu all over again, again

So I’ve received some requests lately to post...

I know some of the services out there post regularly, if not daily. I’m a bit more selective in choosing my spots to talk about the markets. I just haven’t found any inspiration lately. The range is the range. I said 1.65-1.99. We threatened 1.65 last week and here we are at 1.75. No shocker there. We have a good amount of data coming the next few days and some bond auctions to get through as well. The pressure since the 1.70 break is likely to continue, especially with the extra supply. That said, I’d still keep an eye on the data, especially if we are closer to .65 than .99. Make no mistake though, all of this is just a warm up for the end of April. Before the curtain closes on this month, the Fed is going to have their say. Oh and a little thing called q1 GDP. April 27th & 28th are arguably the most important days of the year for interest rates. Whatever happens in the days leading up to that are temporary at best.  

Where we go from here will be determined by that data and the Feds interpretation of it. For some perspective, here’s a chart. The two peaks this year came in Feb and April. Last year?  You guessed it. So in a not so humble brag, we guessed right in figuring that we were going to trade the last 30 days just as we did last year. To that we are here, the future isn’t quite as clear. We’re at an uncomfortable point because it’s hard for me to envision a scenario where the Fed and GDP will signal more hikes vs expectations. Will it be enough to break through though?  What does makes this year different then last is global expectations are much lower.  While it’s hard to bet on a 1% US 10 year, heck, the German 10 year is almost zero. So why not? It should be interesting. Something is going to have to give.  

Stay tuned…

Philip N. Mancuso, Chief Investment Officer

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