After weak September Durable Goods the market was braced for a weaker Q3 GDP in the US but was surprised on learning that the economy is growing at a 2% annualised rate which was up from the previous 1.3%. Consumption and Housing were contributors but exports and business investment drags on growth. One saviour this quarter was defence spending, adding 0.6% after some negative prior quarters.

Due to Hurricane Sandy the NYSE is closed today and probably tomorrow and, unlike Europe, the US does not change clocks until next weekend and as a result we only have a 4 hour time difference. This means that the US markets will open an hour earlier and all US Economic releases will be at 12.30pm and 2.00pm for the coming week. The Bank of Japan meets tomorrow amid more political pressure to keep up Q3 as the economy shows signs of slowing. This morning we have UK Lending and Mortgage Applications while Germany releases their latest inflation data ahead of the Dallas Fed Manufacturing data in the US.

Dec S&P 500

Friday worked really well because, as expected, the market didn’t leave two down Gaps unfilled in the same week. The market entered my buy zone and I went long at 1396 and I was able to take a nice gain at 1408 and I am still flat. Today is going to be tricky as the NYSE is closed for Hurricane Sandy and depending on the damage will probably be closed tomorrow also. I will be a small buyer on any dip to 1390/1396 with a 1385 stop. Again I am
leaving a wider stop due to taking smaller risk given the expected volatility. If Sandy causes a lot of damage the economy will, ironically, get a lift as hurricanes are generally bullish because they stimulate reconstruction.

Dec FTSE

The FTSE traded down to a low of 5731 before rallying 70 points to 5800 on the better than expected US GDP Nos. I went long at 5735, in small size, as the Williams Index started to turn up ahead of my 5710/5730 buy level and I took a nice gain at 5780 and I am now flat. Today I will look to buy any dip to 5720/5740 with a 5705 stop.

Gold Rolling Contract

Gold worked well and I took profit at 1717 on my 1701 long and I am now flat. This morning I will still look to buy from 1698/1703 with the same 1678 stop. Again I am only trading in small size with a larger stop due to the expected volatility.

Dec BUND

As expected the Bund has had a nice rally over the last week but unfortunately it stopped me out before it started to rally. This morning I will be a seller on any further rally to 141.50/141.80 with a 141.95 stop.

Dec DAX

The Dax just missed my buy level on Friday and this morning I will raise my buy level to 7140/7170 with a 7118 stop which is just below the 7120 low made last Thursday.