Written by Gary
Midday Market Commentary For 11-20-2013
The Fed’s Bullard said this morning that if there is a December taper, it will be a small one around 5 billion and the averages immediately dropped almost -0.20% with the US dollar sky rocketing upward 35 cents. The DOW dropped slightly below yesterday’s close and then eased back up into the green while the oils started to post positive numbers.
By noon the averages were comfortable sliding sideways in the green and on VERY low volume.
If any of you are concerned about the Keynesian thinking, lack of real world experience and liberal philosophy that has never worked, wonder no longer. This QE experience is going to end badly, tragically sad.
At one point during the evening, when pressed about whether his Quantitative Easing program was good for Wall Street at the expense of Main Street, Ben Bernanke flat out denied it, saying that such a premise is “simply not true”.
He defended his printing $85 billion per month, suggesting that fixing interest rates at zero is beneficial for society because, among other things, it allows people to ‘buy cars’.
I saw these words coming out of his mouth and thought to myself, “Is this guy f’ing serious?” Cars.
Wow. As if going into debt to purchase a rapidly depreciating consumer item is somehow a victory for the people.
The short term indicators are leaning towards the sell side at the midday, but I would advise caution in taking a position because of the Fed’s reluctance to give any hints of when the taper will begin, maybe today. I would also take chart and other technical indicators with a grain of salt for the time being and watch what the Fed does.
The longer 6 month outlook remains 40-60 sell until we can see what the Fed is going to do, simple as that. If we get Fed tapering in December, back on the table again, the markets will certainly react in a negative fashion as they did this morning with Bullard’s remarks. If the tapering begins in March 2014, like many believe it will, the markets are going to price that in by declining sooner. I am expecting weak to negative markets for the foreseeable future. Also, many pundits have stated that we may have seen the top – but I wouldn’t count it as long as the Fed continues to hand out ‘Market Viagra’! I would like to see a blowout candle (shooting star) to verify a top along with heavy volume.
The DOW at 12:15 is at 15990 up 23 or 0.14%.
The SP500 is at 1792 up 4 or 0.23%.
SPY is at 179.50 up 0.48 or 0.27%.
The $RUT is at 1107 up 5 or 0.47%.
NASDAQ is at 3947 up 16 or 0.40%.
NASDAQ 100 is at 3392 up 14 or 0.42%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been positive and the current bias is up, but moving sideways.
WTI oil is trading between 94.48 and 93.25 today. The session bias is positive and is currently trading down at 94.14.
Brent Crude is trading between 107.96 and 106.52 today. The session bias is now sideways after a sudden rise and is currently trading down at 107.81.
Gold crashed from 1273.60 earlier to 1255.65 and is currently trading down at 1261.50.
Dr. Copper is at 3.169 rising from 3.152 earlier.
The US dollar is trading between 80.77 and 81.01 and is currently trading down at 80.97, the bias is currently positive.
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Written by Gary