Written by Gary
Opening Market Commentary For 09-26-2013
Premarkets were up ~+0.20% before the US Initial Jobless Claims came in at 8:30 with a good number of 305K. Some market investors hungry for data-dependent FOMC found this to be bullish and started melting the premarkets upward slightly (+0.02%).
Markets opened up +0.25% on low volume and then the BTFDers jumped in moving the markets up ~+0.40% in the first 5 minutes. Then slowly melted upward until the 10 o’clock Pending Home Sales report. That financial report came in at -1.6% missing the expected -1.0% and the markets jumped up~+0.10% on low volume.
I am suggesting this mornings news wasn’t all that great and savvy investors are going to wait for the next train as the lower than expected higher volume purports. Indicators still point to a short term sell at 70% to 80% and the buy stands in at 25%.
Bad news extrapolates to investors as more ‘free ice cream’ from ‘ol Ben and his cronies it seems as the averages melt upward. It is only a matter of time when this short term thinking comes to an end and investors rethink their positions. Unfortunately the ‘end’ may not be pretty for some greedy souls.
The Commerce Department’s second reading on U.S. GDP shows the economy expanded at an annual rate of 2.5% in the second quarter, matching a previous estimate. Economists expected GDP to grow by 2.6%.
The Labor Department reports claims for initial jobless benefits fell to 305,000 last week from an upwardly revised 310,000 the week prior. Economists expected the number of claims to rise to 325,000 from an initially reported 309,000. The Labor Department said computer issues that caused a backlog of unprocessed claims have been resolved.
The first column is what was reported today. The second column is what analysts were expecting and the third is the last report.
Maybe we will see a market crash and maybe it won’t. The following article puts things into perspective for those wearing rose colored glasses.
Being bullish on the market in the short term is fine…
The expansion of the Fed’s balance sheet will continue to push stocks higher as long as no other crisis presents itself.
However, the problem is that a crisis, which is ‘always’ unexpected, inevitably will trigger a reversion back to the fundamentals. The market will eventually correct as it always does – it is part of the market cycle.
The reality is that the stock market is extremely vulnerable to a sharp correction.
Currently, complacency is near record levels and no one sees a severe market retracement as a possibility. The common belief is that there is ‘no bubble’ in assets and the Federal Reserve has everything under control.
The DOW at 10:15 is at 15367 up 95 or 0.63%.
The SP500 is at 1702 up 9 or 0.55%.
SPY is at 170.01 up 1 or 0.58%.
The $RUT is at 1079 up 5 or 0.52%.
NASDAQ is at 3793 up 32 or 0.85%.
NASDAQ 100 is at 3238 up 30 or 0.94%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been bearish and the current bias is positive.
WTI oil is trading between 102.20 and 103.28 today. The session bias is bearish and is currently trading down at 102.88.
Brent Crude is trading between 107.88 and 109.24 today. The session bias is bearish and is currently trading down at 108.66.
Gold fell from 1339.62 earlier to 1324.31 and is currently trading down at 1331.60.
Dr. Copper is at 3.310 rose from 3.261 earlier.
The US dollar is trading between 80.40 and 80.70 and is currently trading up at 80.69, the bias is currently bullish.
To contact me with questions, comments or constructive criticism is always encouraged and appreciated:
Written by Gary