HE WHO FALLS IN LOVE WITH HIMSELF…WILL HAVE NO RIVALS. Benjamin Franklin…And the rival Bond market Bulls and Bears seemed to declare a truce last week, as a light news agenda meant no big moves for Bonds and home loan rates. Overall, home loan rates were unchanged to very slightly higher.

The few pieces of economic news that did arrive had a modestly negative influence on home loan rates. Thursday’s Initial Jobless Claims number came in showing the lowest new unemployment claims in more than four years! Also hitting the wire was a narrowing Trade Deficit, and although this report is rarely a big market mover, the Trade Deficit has come under closer scrutiny of late due to concerns about the weakened US Dollar. In fact – it is the weak US Dollar that has likely helped narrow the trade gap. This is because our goods and services become more affordable than similar products based on other currencies. This encourages increased purchasing of US Dollar priced goods and services on a global basis.

GOT CASH? IF NOT, EXERCISE SOME CAUTION THE NEXT TIME YOU USE THAT ATM MACHINE. SOME HIGH-TECH SCAMMERS ARE ON THE PROWL…AND THEY’RE AFTER YOUR MONEY. GUARD YOURSELF BY READING THIS WEEK’S MORTGAGE MARKET VIEW.

Pop quiz. A “Doji” is: a) an exotic sushi appetizer; b) the Japanese word for small dog; or c) a signal of pending volatility for a stock or bond?

Since this is neither a culinary arts nor animal lovers newsletter, it’s likely you guessed that a “Doji” is indeed a signal of pending volatility. It means that for a particular day of trading on a stock or bond, pricing did not improve or decline on the day overall. This means that neither the Bulls nor the Bears are in control…and after a few days of indecisive trading, volatility often follows. This pattern is often called a Doji Star, as the one-day pattern itself resembles a star.

Take a look at the chart below. On the far right, you can see that both Wednesday’s and Friday’s patterns are Doji Stars. The vertical line shows the range in which the Bond traded during the day, slightly higher and lower…but the horizontal line indicates that the Bond opened and closed at exactly the same point, which is somewhat unusual. The appearance of a Doji Star is generally a warning sign to “strap on your seat belt”, as the market may be headed for a ride.

Bottom Line: the heavy news calendar this coming week will be driving the action for home loan rates. While there is no way to predict which way the news will go, technical patterns would indicate that home loan rates are more likely to move slightly higher.

ANOTHER INGENIOUS SCAM…

Teams of organized criminals are actually installing equipment on legitimate bank ATM machines, in order to steal both the ATM card number and the PIN. The team sits nearby in a car receiving the information, which is transmitted wirelessly from the equipment they install on the front of the ATM machine.

The equipment used to capture your ATM card number and PIN is cleverly disguised to look like normal ATM equipment. A "skimmer" is mounted directly to the front of the normal ATM card slot that reads the ATM card number and transmits it to the criminals sitting in a nearby car. Here’s what it looks like:

At the same time, a wireless camera is disguised to look like a leaflet holder and is mounted in a position to view ATM PIN entries.

The thieves are able to copy the cards with the “skimmer”, and with the PIN numbers captured by the camera – they are then able to withdraw money directly from the ATM, just as if they had your actual card right in hand.

Look very closely when you use the ATM machine, for any attachments that look new or out of place. If you see anything that looks different than usual, don’t use the ATM and report your suspicions immediately to the bank, using the phone number on the front of the ATM.

So it’s a good thing Bonds had a chance to rest up a bit last week, as the week ahead just may have some action in store with a full economic calendar ahead. As the reports hit, remember that weaker than expected economic data will help home loan rates improve, while more positive data will generally cause home loan rates to worsen.

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

For the week of February 14 – February 18