Market Commentary: Markets Open Higher, Fall On Anemic Volume

Written by Gary

Opening Market Commentary For 11-04-2013

Premarkets were up indicating a gap up for the cash crowd. Reports galore that this might be the top, can the markets continue and others opining various bearish opinions which to me is a bullish outlook.

Markets gaped up at the opening with the small caps up70% and the large caps trailing at +10%. Within minutes the averages started sliding south sending the oils upward and the US dollar southwards. US Factories Orders came in higher than the last report, but short of what analysts were expecting.

Volume is anemic and investors are sitting on their hands as this Monday session gets under way. The averages are quickly closing in on the gaps made at the opening.

Barchart reported early this morning that the short term is at 60% sell and the medium and long term is 100% sell. Just before 10 am they changed the short term to 20% sell, medium to 75% sell and long term to 67% sell. That is the problem with those services that rely on moving averages and other technical charts indicators because they lose sight of the ‘big’ picture sometimes.

I have said repeatedly that as long as the Fed continues to feed the markets ‘Free Ice Cream’ the averages will have a tendency to hold their position or move higher. If the Fed does start the taper the ‘Market Viagra’ in March, as many believe, the markets will start pricing that expected event in, by declining in January or February 2014. So there is still hope for a Santa Clause Rally for those afraid.

I also have continuing issues with some pundits, writing continually, that there are good setups for day trading which has only been true for swing trading, but the Best Stock Market Indicator Ever: Confirms “Tradeable”. However there is a wedge between perception and reality that has been going on for some time now where the reality doesn’t match the continued bull run. Maybe we have seen the top – but I wouldn’t count it as long as the Fed continues to hand out ‘Market Viagra’!

The short term indicators are leaning heavily towards the sell side but because of the Fed’s reluctance to give any hints of when the taper will begin, I would take it with a grain of salt. Again, if we get Fed tapering in December the markets will certainly react in a negative fashion. If the tapering begins in March 2014 the markets are going to price that in by declining sooner. I am expecting weak to negative markets for the foreseeable future.

The DOW at 10:15 is at 15628 up 12 or 0.08%.

The SP500 is at 1764 up 2 or 0.12%.

SPY is at 176.36 up 0.15 or 0.08%.

The $RUT is at 1099 up 4 or 0.37%.

NASDAQ is at 3927 up 5 or 0.14%.

NASDAQ 100 is at 3382 up 2 or 0.07%.

The longer trend is up, the past year trend is bullish, the past 5 sessions have been sideways and mixed and the current bias is negative.

How Oil Really Gets Priced

WTI oil is trading between 94.08 and 95.10 today. The session bias is mixed and is currently trading down at 94.74.

Brent Crude is trading between 105.57 and 105.12 today. The session bias is sideways and is currently trading down at 105.81.

Gold rose from 1311.07 earlier to 1322.17 and is currently trading down at 1319.20.

Here’s why copper has lost its indicator role

Dr. Copper is at 3.254 falling from 3.253 earlier.

The US dollar is trading between 81.01 and 80.62 and is currently trading down at 80.63, the bias is currently negative.

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Written by Gary