We are getting a little bit of reprieve from the free-fall in mortgage pricing that has sent interest rates upward this month. Market nerds call this chart pattern the “dead cat bounce” because it’s a little bit of a correction that doesn’t have any life in it. On this two year chart, the bounce can be seen as the little blip upward above the blue line on the far right, before it heads downward again breaking through the line. Twelve days later we are in the middle of another one right now–or are we? Only time will tell whether we are in a correction that will reverse and continue to send interest rates even lower than they have been following the long-term trend that commenced in September 2013:
Or whether the market has shifted and we are in a downtrend that started in January of this year:
Taking al of the data into consideration (including that dangling tail hanging off of the end of the graph with the long upward blue line), I would conclude that interest rates are finally on their way back up. Oh, and I apologize to anyone who finds this cat graphic disturbing. I have no personal malice toward cats.