Live Market Commentary For 05-14-2012

After Market Closing Comments:

Felt like I was in the North Sea in the middle of winter with the market going up and down. Don’t get me wrong, I think it is great, just not used to it. Volume was light to medium today and mostly red, especially at the close with some heavy profit taking. The bulls tried valiantly all day to pull off an upset, but in the end the market fell close to its morning lows. Tomorrow the Indexes have to climb back above their, now resistance, zones to stay in the bull game. Failure to do so tomorrow will lead to more weakness. I would say if you haven’t closed out some of your weak longs this might be the last chance.

The DOW closed at 12695 down 125 or -0.98%, the 500 closed at 1338 down 15.04 or -1.11% andd the $RUT closed at 778.95 down 11.11 or -1.41%. Gold melted down and ended the day at 1557, WTI oil ended at 94.16, Brent ended at 111.06 and the USD eased up all day and rested at 80.80 (an extremely nice climb).

The charts below tell the real story of market weakness.

Take a look at SPY and its Bollenger Bands. I am going to guess that tomorrow and the next day will be up.

The 500 at the close. Notice it is below it 100 MA AND closed below the channel support.

The $RUT at the close. The Russell 2000 also closed below its support.

The DOW at the close. It also, like many indexes today, closed below its support.

The Indexes.

@foxnews:______“Concerns that the political instability in Greece will rattle the fragile eurozone currency bloc sent traders across the globe racing out of risky assets and into the shelter of safe havens. The broad S&P 500 slid 1.1% to 1338 – its lowest close since February. U.S. crude oil futures, meanwhile, dropped 1.4% to the lowest settlement price of 2012. “

@advfn:

“Much of the weakness on Wall Street stems from lingering concerns about the political uncertainty in Greece, as the debt-plagued nation seems likely to be forced to hold a new round of elections due to lawmakers’ inability to form a coalition government.

Peter Boockvar, managing director at Miller Tabak, noted that another Greek election would basically being an up or down vote on the country’s euro membership.

“The growing possibility of Greece saying bye bye has put the entire region into the realm of the unknown in terms of the economic ripple effects,” Boockvar said.”

@telegraph:

Negotiations to form a new Greek government will carry on for yet another day tomorrow.

President Karolos Papoulias will hold talks with the leaders of all the parties which had members elected to parliament in the election eight days ago – excluding the extreme right-wing party.

Talks will start at midday London time.

However Evangelos Venizelos, leader of the PASOK Socialist party, said he is not optimistic any agreement can be reached after the inconclusive election and the refusal of Syriza to countenance agreeing to austerity measures set by the EU and IMF.

Noon market Commentary:

There are no US financial’s today so the down day has to be blamed on the news from Europe, but tomorrow we have Retail Sales, CPI, Empire State Manufacturing and some NAHB and MBA housing and mortgage data that could possibly change the direction of the markets, but not likely as I suspect the European soap opera will continue to flood the news wires. The DOW is at 12733 down 86.27 or -0.67%, the 500 is at 1346 down 9.54 or -0.70% and the $RUT is at 782 down 7.85 or -0.99%.

As if on cue the US markets started to rise at the close of the European markets. The DOW, 500 and the $RUT climbed out from the morning lows but failed to make a convincing case for the bears. Chart wise it is impossible to tell what the DOW has done, or will do today. The 500 dipped below it 100 day MA and its sideways channel, but only came back above its channel support.

The $RUT on the other hand dropped below its channel support at 783 and is close in testing its 200 day MA (753). These are not encouraging signs that this is just a simple ‘correction’, but something much bigger in scope.

I am getting tired of waiting and sitting on my hands, but this is certainly not the time to get brave either. I would love to get some McDonalds (MCD), but better prices are coming.

After Market Opening Comments:

No surprise that the markets opened down, but the ‘Dippers’ are once again out in force to buy the dip. The green volume is very light and the bulls were unable to immediately pull the markets back up. The 500 closed on Friday at 1353 and was at 1340 early on. The DOW closed at 12820 and dipped to 12714. The first 10 minutes didn’t bring about any surprises as the DOW was at 12710 and the 500 was at 1340, both having been a couple of points higher while the ‘dippers’ were at work. Gold and the oils have remained more or less where they have been for the last hour indicating, along with declining volume that this is going to be a wait and see morning.

The morning trend is down and so is the bias. Volume is moderate to low and mostly red. The markets are now trading is a narrow range and will most likely improve once the European markets close at 11:30 am. The 3X ETF’s still have not exhibited their ability to move in extremes indicating to me to continue to sit on the sidelines and wait for better trading day’s.

Premarket Comments:

The SP500 futures were down as low as 1335 and then stayed in the 1337 area as the premarket fumbled about. Greece is still the number one talk about town and general unrest regarding the Eurozones financial activities are dragging the markets around the World down.

Asian Markets closed mixed with the Hang Seng down 1.15%. Europe is currently down across the board 2% with the CAC40 down over 2.51%. Gold is at 1651, WTI was down to 93.72 and melted it way back up to 94.22. Brent was down to 110.25 and it too has melted its way back up to 110.70

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Written by Gary