Market Commentary: Markets Open Up, Then Down, Then Sideways On Low Volume

Written by Gary

Opening Market Commentary For 10-31-2013

Premarkets were down -0.10% after Initial Jobless Claims came in 10K lower than last month. Premarket action also saw gold drop and the US dollar rising.

Markets opened down (-0.15%) in the red on low volume and the quickly melted up to be mixed and flat as investors digest the Fed’s minutes from yesterday. Lacking the ‘BTFDers’, the averages started melting down again and by 10 am the US Chicago Purchasing Manager came in 10 points higher and the averages reacted negatively dropping to yesterday’s lows.

The short term indicators are slightly bearish, but both the short and long term indicators are so near the 50-50 mark that no real trend is evident. Some analysts believe we have really see the market top, while others, including myself, believe there is a strong case for further upside as long as the Feds continue with the monthly ‘market Viagra’ infusion.

The bearish indicators are being dashed after the Fed left its bond-buying program untouched yesterday, as expected, but released a statement that was apparently not quite dovish enough for some. The FOMC left out a reference to tightening financial conditions, which had been included in the September statement. Some analysts have concluded that as meaning the Fed hasn’t ruled out tapering in December which should please the bears.

The US Central Bank, more commonly known as the Fed, yesterday decided to keep its monthly $85 billion bond buying program unchanged and pleasing the bulls. Of course, any excuse to keep pouring money into the ‘system’ by the Keynesian doves was now due to weaker economic growth that was hampered by the 16-day partial government shutdown earlier this month. Next month it will be something else.

While many economists, including myself, expect a reduction to quantitative easing will be held off until March 2014. However, some interpreted the Fed’s statement to a suggestion that it could come in December.

The DOW at 10:15 is at 15568 down 52 or -0.33%.

The SP500 is at 1758 down 5 or -0.28%.

SPY is at 175.83 down 0.46 or -0.26%.

The $RUT is at 100 down 5 or -0.47%.

NASDAQ is at 3918 down 13 or -0.33%.

NASDAQ 100 is at 3375 down 10 or -0.28%.

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

How Oil Really Gets Priced

WTI oil is trading between 96.98 and 96.07 today. The session bias is bearish and is currently trading down at 96.28.

Brent Crude is trading between 109.82 and 108.88 today. The session bias is negative and is currently trading down at 108.92.

Gold fell from 1341.92 earlier to 1321.33 and is currently trading down at 1324.90.

Here’s why copper has lost its indicator role

Dr. Copper is at 3.307 rising from 3.291 earlier.

The US dollar is trading between 79.48 and 80.21 and is currently trading up at 80.19, the bias is currently positive.

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

[email protected]onintersect.com

Written by Gary