Midday Market Commentary For 09-14-2012
Noontime rolled around watching the averages melting down from the morning highs. Low red volume indicates some profit taking, but leaves some doubt to the eventual outcome of the ‘open ended’ QE3 now in effect. All of the markets, including the ones across the globe are in a turmoil for at least today. Nothing else going on as we watch the dust settle.
I continue to think the QE3 is a mistake, a big one, but only time will tell who is right. Obviously, Dr. Ben thinks I am wrong and a $hit load of debt is going to be good for us as a Nation.
So, I will caution at least myself not to get to far out on the limb watching the markets melt up as they have done in the past implementation of QE’s because this one might, just might, fall over backwards and in quick fashion.
The RRR** today points to more skepticism to the rally yesterday as the Ratio remains very narrow, unnaturally so. It should be wide enough to easily make safe trades and I continue to believe any trades will probably end up on the unprofitable side as long as this market exhibits low volume. Swing trading is at your own risk and being the market is at a crossroads of sorts, I would prefer to sit on my hands rather than risk guessing incorrectly.
The DOW at 12:15 is at 13598 up 57 or 0.42%.
The 500 is at 1468 up 8 or 0.55%.
The $RUT is at 865.72 up 9.62 or 1.12%.
SPY is at 147.44 up 0.84 or 0.57%.
The trend is up and the current bias is down.
WTI oil is at 98.80 trading between 98.16 and 100.40 and the bias is negative.
Gold is up today at 1774, trading between 1765.00 and 1778.00 with a positive bias.
Dr. Copper is at 3.83 up from 3.73 earlier.
The US dollar fell from 79.93 earlier to 78.73 and is currently trading at 78.88.
“Everything will collapse” is the consequence Gloom, Boom, & Doom’s Marc Faber sees from the Fed’s latest ‘stimulus’ (and the fallacy and misconception of how money-printing can help employment).
In a wondrously clarifying interview on Bloomberg TV this morning, Faber explained why he was ‘happy’, since “the asset values of his holdings will go up” but as a responsible citizen he is worried because “the monetary policies of the US will destroy the world.”
It truly is class warfare under a veil of ‘its good for you’ as he notes: “the fallacy of monetary policy in the U.S. is to believe this money will go to the man on the street. It won’t.
It goes to the Mayfair economy of the well-to-do people and boosts asset prices of Warhols.” Congratulations, Mr. Bernanke.
** RRR = Risk Reward Ratio
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Written by Gary