Written by Gary
Today’s Market Commentary For 02-16-2015
If you haven’t guessed by now the U.S. Markets are closed for Presidents Day holiday and will reopen tomorrow, Tuesday the 17th.
The Ukraine cease fire is largely holding with some sporadic fighting here and there and it still remains to be seen if this cease fire will remain in effect. The Greek ‘issue’ is still a problem as the Eurozone offer them little leeway as talks begin. I have some thoughts below on how the talks ended today and current oil prices below.
Reuters reports, “Greek government officials say the Eurogroup discussed “unreasonable” and “unacceptable” terms on extending bailout and a Government official says under these circumstances, there cannot be a deal today.”
DailyFX.com reports, “So much for stories last week of a Germany-Greece deal. Odd how weak conjecture offered as much Euro bid as news of impasse triggered drop. Apparently the Greece government official also called the EU proposals ‘absurd’. I wonder if Germany’s language will be as colorful.”
BRUSSELS – Eurozone finance ministers turned up the pressure on Greece ahead of a key meeting that began here on Monday, saying that little progress had been made in talks over the weekend and calling on Athens to ask for an extension of its unpopular bailout program.
The ministers said a deal with Greece’s new leftist government at Monday’s meeting is unlikely. And another meeting at the end of the week will probably be necessary, several said, though a deal even then isn’t guaranteed.
“The Greek government hasn’t moved at all,” German Finance Minister Wolfgang Schäuble said, as he arrived at the meeting.
Greece’s bailout program expires at the end of February. If Athens doesn’t ask for an extension, it will be left without financing just weeks before it must repay loans to the International Monetary Fund on March 15.
As I have written before, when a ‘deal’ is reached between Greece and the EU, no one is going to be happy, especially investors, as both sides have much to lose.
We remain mostly conservatively bullish, but with a bearish slant. I am very concerned any downtrend could get very aggressive in the short-term and any volatility may also promote sudden reversals that will only please the day traders.
Having some cash on hand now is not a bad strategy as negative market changes are happening everyday. As of now, I do see some leading indicators that are warning of a ‘long-term’ reversal within six months. I believe one is most likely to occur later in 2015, but any market fluctuations we see now are more of a internal market rectification than a bear market.
Investing.com members’ sentiments are 59 % Bearish.
CNN’s Fear & Greed Index is 73. Above 50 = greed, below 50 = fear. (At ‘GREED‘) (Chart Here) The number of stocks hitting 52-week highs exceeds the number hitting lows and is at the upper end of its range, indicating extreme greed.
Some analysts are betting that oil has bottomed and higher prices are here to stay as Oil tops $53 a barrel. Just by looking at the daily chart of WTI (below), one can see where it has failed on numerous occasions to penetrate the resistance at 54.59. My thinking is that we will see oil fall further sooner rather than later as does Michael T. Snyder in his article, Why The Price Of Oil Is More Likely To Fall To $20 Rather Than Rise To $80.
WTI oil is trading between 54.09 (resistance) and 52.91 (support) today. The support currently is ~46.70 and the next resistance is ~54.00. The Iranians say they are comfortable with $25 and I’ll bet the Saudi’s will do everything possible to make it painful for them, meaning much lower prices to come. The session bias is neutral, sideways and is currently trading up at 53.90. (Chart Here)
The fly in the ointment here regarding oil NOT moving to higher prices is that Brent has moved into the resistance made in 12/15/2014 to 12/22/2014 with highs of ~63.00 as seen in the daily chart below. The daily trend is upwards, but has NOT broken out and may or may not continue to move upwards in the sessions ahead and needs to be watched.
Brent Crude is trading between 62.52 (resistance) and 60.73 (support) today. The support currently is ~50.40 and the next resistance is ~63.00. The session bias is neutral, sideways and is currently trading down at 61.83. (Chart Here)
Today trading in the FOREX markets is relatively quiet, but a look at the US dollar gives a hint what the European and global markets are doing today and most likely reflect on tomorrows US market actions.
The daily chart below shows where the dollar has been trading. Neither falling or rising but continuing a consolidation that has not really broken the trend upwards.
The US dollar is trading between 94.39 and 93.97. U.S. dollar is currently trading up at 94.42, the bias is currently positive and volatile. (Chart Here)
Resistance made in Aug., 2013 (~85.00) has been broken and now is support. This support has gotten much stronger since August, 2014 and isn’t likely to fall easily. The level of ~92 is the current support and is substantial. The ~94.25 area appears to be a minor resistance for those interested. Historical chart Here.
WORLD MARKETS TODAY
European markets finished lower today with shares in Germany leading the region. The DAX is down 0.37% while London’s FTSE 100 is off 0.24% and France’s CAC 40 is lower by 0.16%.
The markets are still susceptible to climbing on ‘Bernankellen’ vapor, use caution!
“Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation inequities, they should try to be fearful when others are greedy and greedy only when others are fearful.” – Warren Buffett
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Fridays Closing Market Numbers
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Written by Gary