It was a bit of a bittersweet day for mortgage rates.  On the one hand, it was the Fed's first day buying a new category of mortgage-backed bonds--one that would help pave the way for rates to move gradually lower if the broader bond market remains in reasonably strong territory.  On the other hand, the broader bond market had a very bad day, thus raising questions about how much longer it will remain in reasonably strong territory. 

Mortgage rates have been doing a very good job of resisting the implications for higher rates seen in the broader bond market, but there's a limit to how long they can continue to hold out.  If we continue having days like today in the broader bond market (i.e. 10yr Treasury yields rising more than 0.06%), mortgage rates will increasingly be compelled to move in the same direction.

Of course everything is relative.  Rates and Treasury yields could continue to rise and we could still refer to them as historically low.  But everything's relative!  And the average mortgage rate watcher has a vested interest over shorter time horizons.  In other words, if I'm in the middle of the mortgage process, you could tell me not to worry and rates near 3% are insanely low in the big picture, but all I'd really care about is what the next few days and weeks of market movement are going to cost me in terms of a higher payment.

Fortunately, today's rate increases were fairly modest.  The risk is that the past few days of sideways-to-slightly lower rates were merely a temporary reprieve from October's prevailing trend of sideways-to-slightly higher rates.  Either way, the biggest moves are reserved for next week following the presidential election.  There's no way to know if rates will move higher or lower, only that they're far more likely to do so in a bigger way.