Market Commentary: The Great Santa Claus Rally Melt Up

December 24th, 2013
in Gary's blogging, market close

Written by

Closing Market Commentary For 12-24-2013

As we close early for the Holiday's it was a good day for the bulls, but I am not sure just who is actually buying as no one in this office has dipped their toes into today's fray.

By 1 pm the major averages were in the green after trading in a tight narrow range for most of the late morning / afternoon. We here at Econintersect wish you and your loved ones a very Merry Christmas and Happy Holidays.

Follow up:

The short term indicators are leaning towards the hold side at the close, but I would advise caution in taking any position during this volatile transition period. Here is the quandary some investors have now. They have bet on the QE program to bolster their profits and knowing full well they may see some eroding over the next few months, so what should they do? Start reducing positions now, most probable, or let profits ride a bit longer?

I would also take chart and other technical indicators with a grain of salt for the time being and watch what the Fed does over the next 4 months. Removing 10 billion from the bond buying program each month isn't going to do much in reducing the QE program in the beginning, but halving it in 4 months certainly will - IF - the Fed's continues the taper program. My instincts tell me that the Keynesian's are going to be reluctant to stop their grand financial experiment and will want to taper the taper within the next several months - especially if the employment rate increases.

The longer 6 month outlook still remains 40-60 sell until we can see what the effects are in this almost nothing start of the Fed's 'Taper'. By March investors should know how the taper is going to work out in relationship to the stability of the US financial markets and their ability to not to slide downward.

For now, I am continuing to expect weak to negative markets for the foreseeable future. My advise is to invest in tennis balls as they have a higher rate of return!

Also, many pundits have stated that we may have seen the top - but I wouldn't count it as long as the Fed continues to hand out 'Market Viagra', even if it has been reduced somewhat! I would like to see a blowout candle (shooting star) to verify a top along with heavy volume.

The DOW at 1:00 is at 16358 up 63 or 0.39%.

The SP500 is at 1833 up 5 or 0.29%.

SPY is at 182.95 up 0.42 or 0.23%.

The $RUT is at 1162 up 4.57 or 0.40%.

NASDAQ is at 4155 up 7 or 0.16%.

NASDAQ 100 is at 3573 up 3 or 0.10%.

The longer trend is up, the past months trend is bullish, the past 5 sessions have been positive and the current bias is sideways.

How Oil Really Gets Priced

WTI oil is trading between 98.65 and 99.29 today. The session bias is positive and is currently trading down at 99.19.

Brent Crude is trading between 111.43 and 112.05 today. The session bias is positive and is currently trading down at 111.95.

Gold rose from 1195.68 earlier to 1204.86 and is currently trading down at 1203.20.

Here's why copper has lost its indicator role

Dr. Copper is at 3.367 rising from 3.311 earlier.

The US dollar is trading between 80.62 and 80.77 and is currently trading down at 80.67, the bias is currently negative.

To contact me with questions, comments or constructive criticism is always encouraged and appreciated:


Written by Gary


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