Mortgage Product BiasMortgage Product Bias Indicator
Overview:
The "Mortgage Product Bias" indicator is designed to assist investors, analysts, and mortgage brokers in identifying trends and potential biases in the mortgage products market. This tool evaluates the relative positioning of the RBA (Reserve Bank of Australia) cash rate against a calculated average interest rate over a specified period, providing insights into whether market conditions favor fixed or variable rate mortgage products.
Functionality:
Data Sources: The indicator utilizes real-time data from the RBA cash rate (AUINTR), integrating these values to generate insights based on historical averages.
Average Interest Calculation: Utilizes a user-defined number of months (default is 7 months) to calculate the exponential moving average (EMA) of the cash rate, which represents the average interest rate over the specified period.
Bias Identification: Determines the bias towards fixed or variable rate products:
Fixed Rate Bias: Triggered when the current cash rate is higher than the average interest rate, indicating a potential market leaning towards fixed-rate products.
Variable Rate Bias: Triggered when the current cash rate is lower than the average interest rate, suggesting a favorable condition for variable rate products.
Usage:
For Investors: Use this indicator to gauge the best times to enter into fixed or variable rate mortgage agreements based on historical pricing trends.
For Analysts and Mortgage Brokers: Provides a visual tool for advising clients, preparing reports, and making data-driven decisions in the mortgage industry.
Visual Elements:
Color-coded Display:
Red indicates a fixed rate bias.
Green indicates a variable rate bias.
Gray indicates neutral conditions where the cash rate aligns closely with the average rate.
Horizontal Line: Represents the threshold level at -0.5% to highlight significant deviations in the cash rate from the average.
Implementation:
To use the Mortgage Product Bias indicator, simply add it to your TradingView chart from the Indicators menu and configure the length of the average interest rate calculation as needed. The tool is designed for ease of use and can be customized to fit individual or institutional analysis workflows.
Disclaimer:
This indicator is intended as a tool for financial analysis and decision-making. Users should consider additional factors and conduct comprehensive market research before making financial decisions based on this indicator.