The mortgage rates hit a recent bottom in early September, and have gone up substantially over the past few months. If we look at a chart of the 10 year note (direction most closely correlates with mortgage rates), you can visually see how the rates jumped from approx. 2.0% to Friday’s 2.66% in only 4 months.
The 2.66% level is critical as several times since 2014 the note has gone up to the 2.635% level, and then has backed off. That creates a technical resistance level at the 2.635%. If the note rate stays higher than the 2.625% over the next couple days, the next major resistance level is at 3.04%, another .4% higher from here.
Primary reasons rates have been going up:
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Federal Reserve started to liquidate it’s $4.5 trillion balance sheet they accumulated in their Quantitative Easing artificially dropping interest rates. They will be increasing the amount they’ll be rolling off the balance sheet every quarter.
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Foreign buyers have been backing away from buying US bonds and mortgage backed securities, as the dollar has weakened relative to other currencies
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Strength in the economic statistics, and perception that new tax bill will add to to the strength and inflation
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Federal Reserve continues to increase the Fed Funds Rate on a consistent timeline
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