US Equities staged a minor recovery into the close on another very quiet day for trading as markets wait for ‘corporate earnings season’ to start tomorrow. The S&P and the Dow ended the day down 0.3% having been down 0.6% earlier. Risk appetite is a little weaker at least as indicated by a small rise in the VIX, whilst commodity prices are mostly lower. Despite this the US Dollar is weaker against all G10 currencies. The Eur/USD closed over 120 points higher off the lows made on Friday which may in part be related to a desire by Global Fund Managers to load up on European Financial Stocks after the news on the 4 year extension for banks to get their houses in order as mentioned at length in yesterday’s commentary. This start could gather legs ahead of the ECB meeting on Thursday and as usual the press conference after will be interesting especially if the ECB decides to cut rates.
Today at least we have some economic data due after yesterdays non event. In the UK we have Retail Sales at 9.30am followed by German November Trade and Current
Account. In the Euro-Zone we have December Consumer Confidence, November Retail Sales as well as Business Climate and Confidence Indicators. Later in the US we have the NFIB Small Business Optimism Index and Consumer Credit.
March S&P 500
A very quiet trading day as the market waits for earnings season to kick off and as it tries to absorb the huge move up in the S&P last week. The market dropped down to my buy level and I went long at 1452 and I took a nice profit at 1457 and I am now flat. Today I am still a buyer from 1451/1455 with a 1449 stop. I am also a seller from 1465/1469 with a 1472 stop.
Silver Rolling Contract
Silver dropped down to my buy zone and I went long at 29.90. I will raise my stop to 29.70 and I will look to take profit on any rally to 30.50/30.80. If the market rallies to my ‘take profit’ zone I will then look to reset my long position if it drops back to the 30.00 area with the same 29.70 stop on any new long position.
March BUND
No change as I am still long from last Friday at 142.85. I will raise my stop to 142.75 and I will still look to take profit on any rally to 143.50.
Eur/USD
The Euro just missed my 1.2990 buy level before rallying. Today I am going to stand aside as I am worried that the Basle news on banks may give the Euro some upside. If the Euro trades back to 1.3050 I am a small buyer with a 1.3010 stop which is just below yesterday’s low.
March DAX
The Dax is trading in a very quiet range and I do not want to chase the market. I will leave my sell level the same at 7820/7840 with a 7855 stop.
March FTSE
The FTSE is also trading in a very quiet range after Fridays up move. The FTSE continues to be overbought and today I am a small seller on any rally to 6070/6090 with a 6105 stop. I do not want to be long at this time.
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