Last night Alcoa kicked off the earning season with a surprise profit-the first after three quarters of losses. In addition they said they believe that business has stabilized for many sectors. However, as has often been the case, much of their profit came from cost-cutting, not an expansion of sales. There also were some positive comments from the CEO of Google. The BOE and ECB both left their rates unchanged; this is pressuring the Dollar. The other factor in the markets today is a continuation of the risk premium trades-this causes a lower Dollar, higher equities and commodities, a lower Dollar and Treasuries. Weekly jobless claims were out a 7:30; they showed a much bigger than expected drop.
Dec. S&P: Rallying on a breakout day setup (ID/NR4). I had breakout points at Tuesday’s high of 1056.75 then 1061.75. The first profit target is the 9/29 high of 1065.75.
Dec. NASDAQ: Breakout mode; cleared the first breakout point at 1711.25. First profit target is the 9/28 high of 1732.50.
Dec. T Bonds: A momentum sell short day today; they are trading under support at 122-24. The next support is 122-10.
Dec. Dollar Index: It looks like it’s getting ready for a downside breakout. A close under the recent low at 76.045 could do it. MACD appears ready for a bearish crossover.
Dec. Euro FX: It had a breakout setup yesterday; it rallied after this morning’s ECB meeting. Tuesday’s high of 14761 is resistance.
Dec. British Pound: Breakout setup today; it cleared the resistance at Tuesday’s high of 1.6021. There’s trendline resistance at 1.6089 then common number support/resistance at 1.6124.
Dec. Gold: This is why you don’t fight a breakout setup. Momentum is on a sell short signal, but it was a doji, NR breakout day today. The contract high for GCZ is 1060.00.
Dec. Silver: An NR breakout day; it’s testing the 2009 high at 17.69.
Dec. Copper: Breakout setup today; clearing Fib retracement resistance around 282.60 is especially bullish. MACD is nearing a bullish crossover.
Dec. Cocoa: Breakout setup; it’s testing the contract high at 32.68.
March Sugar: Hit support / downside objective at the 9/8 low of 21.95. It may consolidate over that, but I don’t expect it to hold.
Dec. Coffee: Breakout setup; there’s big resistance at the top line of a big triangle at 137.45. Clearing that would be huge for the bulls.
Nov. Crude Oil: On a momentum buy signal today after holding Fib retracement support of 69.35 yesterday. It’s testing first resistance at 70.43 now; next is 71.05.
Dec. Lean Hogs: It’s on a momentum sell short signal and approaching the last high at 53.10. Bulls should be cautious up here.
Grains: The recent rally has come as inflation talk has picked up a bit and the Dollar has sold off. Tomorrow morning we get new estimates from the USDA of the size of this year’s corn and soybean crops. Both are expected to be huge; how they react to the report may set the tone for the short term. Normally grains sell off as the harvest comes in; will this year be an exception?
Nov. Soybeans: Breakout setup today. It’s clearing trendline resistance at 912-4; that would be huge for the bulls. Tuesday’s high at 921 is the next resistance.
Dec. Bean Oil: It has really coiled up to form a triangle on the daily chart; will it break out before tomorrow’s report?
Dec. Wheat: Breakout setup today; resistance is in the area from 471-4 to 472-4 (Tuesday’s high to trendline resistance) I’d like to buy a pullback; 450 is support.
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