August 29th, 2012
in Gary's blogging
Closing Market Commentary For 08-29-2012
Market advanced to yesterday's highs and backed off to numbers close to the opening bell. The Beige Book indicated the economy is gradually expanding but the news wasn't good enough to offset investors worries that Ben in J Hole wouldn't become an A Hole when he announces that there won't be a QE3.
At the close there was a brief profit taking spurge that in itself was not notable, only the red volume which was notable. Not especially high, but notable leaving the markets in a flat and confused state.
Economic activity expanded gradually across the Federal Reserve’s 12 districts in July and early August, the central bank said in its anecdotal Beige Book report. The labor market held steady or showed only slight signs of improvement in most districts. Meanwhile, the housing sector, retail spending and credit conditions broadly improved.
The RRR** is again very narrow by the closing bell and any trades probably will end up on the unprofitable side while this market remains flat. Swing trading is at your own risk and being the market is at a crossroads of sorts, I would prefer continuing to sit on my hands rather than risk guessing incorrectly. Any gains made will be small and insignificant and not worth the worry.
The DOW at 4:00 is at 13107 up 4.49 or 0.03%.
The 500 is at 1410 up 1.19 or 0.08%.
The $RUT is at 817.84 up 3.56 or 0.44%.
SPY is at 141.38down 0.02 or -0.01%.
The trend is neutral and the current bias is bearish.
WTI oil is at 95.08 trading between 96.30 and 94.77 and the bias is negative.
Brent crude is at 112.72 trading between 113.30 and 111.50 and the bias is neutral.
Gold is at 1656.11 trading between 1669.60 and 1659.08 with a neutral bias.
Dr. Copper is at 3.44 down from 3.46 earlier.
Earlier the USD tumbled from 81.52 to 81.35. It then rose on the US economic data to 81.60 and is currently at 81.56.
The 500 at the close.
The DOW at the close.
The market does not seem ecstatic with the relative positivity from the Fed's Beige Book - good news is bad it seems - as via Bloomberg:
*FED DISTRICTS SAW ECONOMY GROWING `GRADUALLY' IN JULY, AUGUST
*FED SAYS MOST DISTRICTS SAW STABLE PRICES FOR FINISHED GOODS
*FED SAYS `UPWARD WAGE PRESSURE' WAS `VERY CONTAINED'
*FED SAYS REAL ESTATE MARKETS `GENERALLY SAID TO BE IMPROVING'
*FED SAYS SIX DISTRICTS SAID ECONOMY EXPANDED `AT A MODEST PACE'
*FED SAYS MOST DISTRICTS SAW INCREASE IN RETAIL SALES
*FED SAYS BANKERS IN SIX DISTRICTS SAW RISING LOAN DEMAND
** RRR = Risk Reward Ratio
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Written by Gary