The U.S. dollar continues to move all markets.
Thursday, December 10th, 2009. 9:15 a.m.
The direction of the dollar continues to control the direction of the stock market, bonds, gold, and most commodities on a daily basis.
With the dollar very oversold, the possibility of a rally in the dollar is likely to make for considerable volatility in other areas for awhile, as traders try to get a handle of whether the dollar will finally begin to rally, or not.
Yesterday in the U.S. market.
A positive day. The minor early sell-off quickly reversed to a spike-up, until the magic hour of 11 a.m., when a downside reversal of several hours took place. But late day buying brought the market back up to a positive close.
Recent intraday volatility was missing, the Dow down only 50 points at its worst, and up only 53 points at its best.
Yesterday’s Intraday Chart:
The Dow closed up 51 points, or 0.5%. The S&P 500 closed up 0.4%. The NYSE Composite closed up 0.2%. The Nasdaq closed up 0.5%. The Russell 2000 closed up 0.1%. The DJ Transportation Avg. closed up 0.1%.
Asian markets gave up early gains last night to close mixed.
The DJ-Asia index closed down 0.8%.
Among individual countries; Australia closed down 0.6%. China closed up 0.7%. Hong Kong closed down 0.2%. Japan closed down 1.4%. India closed up 0.4%. Singapore closed down 0.6%. South Korea closed up 1.1%. Taiwan closed down 1.5%.
NOTE: If you’d like to see a 4-month chart of any of these markets (and more), click here, and click on any of the market indexes at the left side of the page it takes you to.
Markets this morning:
European markets Are up quite strongly, close to 1% on average.
Oil is up $.50 a barrel at 71.17 at the moment.
Gold is up $8.50 an ounce at $1,130 at the moment, after hitting another new pullback low yesterday.
In the U.S.
The week’s very light schedule of potential market-moving economic reports continues. To see the full schedule click here, and look at the left side of the page it takes you to.
The U.S. Trade Deficit numbers and report of new weekly unemployment claims were released at 8:30 a.m.
Weekly unemployment claims rose by 17,000 last week, after several weeks of encouraging declines.
The U.S. Trade Deficit unexpectedly narrowed 7.6% in October, to $32.9 billion, thanks to exports rising more than imports. The deficit for the year-to-date has improved significantly from $610.8 billion a year ago to $308 billion.
The reports have had little influence on our early morning indicators, which have been fairly positive for several hours.
Our pre-open indicators are pointing to the Dow being up 50 points or so in the early going.
Stock Market Patterns.
The ‘monthly strength period’ was due to end last Friday, and did so.
This week is the week before this quarter’s quadruple-witching expirations week, and the week before tends to be negative, and has been so far. (As of yesterday’s close the Dow is down 0.5%, and the S&P 500 down 0.9% for the week so far).
The next pattern is that next week is the expirations week, and it tends to be positive, particularly if the week before is negative.
Interesting Chart of the Morning.
Oil prices soared into a bubble in 2008. The bottom fell out late in the year last year. They recovered roughly 50% of their decline this year, often a normal retracement of a market move.
And now its recent breakout above overhead resistance has been given back.
Please scroll down to see other recent ‘Interesting Charts of the Morning’.
To read my weekend newspaper column ‘The Economic Recovery is Looking Stronger Every Week!’ click here!
NOTE: We have changed the name of the blog. Please change to the new address, StreetSmartPost.com, and make the change in your favorites list.
Subscribers: A ‘Gold, Bonds, Dollar, Inflation’ update will be in the subscribers’ area of the website later today.
Non-subscribers to Street Smart Report: While it’s helpful to look at daily and short-term expectations, it is the intermediate and longer-term signals and market moves that are most important to investors. So, please consider a subscription to our independent research. The cost is equivalent to the cost of two cups of coffee per week. Can you afford not to subscribe?
Street Smart Report Online provides our intermediate-term signals, outlook, and recommended holdings. Sectors, stocks, bonds, gold, short-sales, long-side and inverse etf’s and mutual funds. Highly regarded and in its 22nd year. In-depth weekly reports, newsletter, hotline, and much more! As a bonus for a one-year subscription you will also receive my latest book Beat the Market the Easy Way- Proven Seasonal Strategies That Double the Market’s Performance. Click here for subscription information.
