Be wary of these Holiday Markets. My opinion is that the markets have mostly had their moves for the month, via last Friday’s Unemployment Figure. For the rest of the year, most likely we will have sideways to possibly higher chop. The word chop, actually, is pretty much an anachronism. Every day is choppy. In every market with computerized algorithms running in the background.
So you trade selection is key, as is your management losses. My general feeling is to trade very little until the first of the year.
So far today DJZ9 opened at 10365, posted an early low at 10360 and a high at 10430. If we get a typical range, you can look for resistance at the 100 point range around 10465, with major resistance up at 10500 level.
SPZ opened at 110450, posted a low at 110420 and a high at 111020, slightly lower on the day.
Crude oil is on its heels today, posting a high at 76.10 and low at 7404. On the charts, we have a ways to go build a base of support. 80 dollars remains key longer term resistance. Crude looks as if the fundamentals are starting to weigh on the currency issues. With world stocks so high, it looks like traders are for the time being looking more towards potentially bearish fundamentals.
The metals are having a continuing pullback after an unprecedented run up in prices.
Just last week Gold was above 1200 and ounce and Silver was above 19 dollar an ounce.
The spike up, seemingly, was spurred by massive short covering after the Thanksgiving day break. A lot of people sold the metals in the hole that night,if you look at the chart. Once again, a relative lack of liquidity, let to a vicious rally, as all of the programs jumped from bearish to bullish overnight.
Today Feb Gold has a high at 1.162.50 and a low at 1.136.10 with a last print at 1,142, down 275 so far. March Silver is down 535 at 1798, with a high at 18585 and a low at 17930.
In the Grains this morning, we remain range bound, if you take a look at the daily charts. SF, Jan beans, are moving in a 30 cent range bounded by 1060 and 1030. Today we opened at 1049, posted a low at 1038,and then rallied to 1061 1/2, up 12 cents on the day. However, if the market so much as sneezes, the computers will take us back down to the 1050-1034 band. All of these moves are suspect.
In the meantime, watch the crude oil and the dollar index.
The other factor which will affect bean prices is the weather in Brazil. So take some Portuguese language lessons and turn on the weather channel for South America. Its their Summer now, and they are growing beans. In 6 months we will be watching our weather every day, but for now, its all about rain fall in Brazil and how it will impact their grain production.
December Wheat and December Corn are also range bound on the daily charts. So far today CZ opened at 371 1/4, posted an early low at 370 and rallied with the beans to a high at 378. Resistance for the Corn is at the 385 to 400 trading band, with support down to the 357 area.
December wheat opened at has a trading range so far between it low at 530 and a high at 536, basically unchanged at the moment.
Factors which will impact the corn and wheat are export numbers, as well as the relative strength of the US Dollar.
Good Trading.
