Thursday Recap: A look inside the market

SPX INTRADAY

Stocks were ready to open a bit higher despite disappointing earnings from FedEx and a bond auction in Spain that once again saw yields rise. The Labor Department reported that initial claims for unemployment insurance for the week ending December 11 fell by 3,000 to 420K. The week’s total was 1K below the Reuters consensus for a reading of 421K. Continuing Claims for unemployment for the week ending December 4 were above consensus at 4.135M vs. expectations for 4.049M and last week’s revised (higher) 4.113M. Housing Starts rose by +0.3% in November to an annualized rate of 555K. This was above the consensus for 545K. The October numbers were revised higher to an annualized rate of 534K from 519K. Building Permits for November fell to 530K. This was below the consensus of 537K and last month’s reading of 552K.

The Thursday session opened with a one point gap higher and carried through for a couple more points in the opening minutes. But mild weakness hit the tape and by 10:03 am the low of the day was painted. The rest of the session gravitated higher with one sudden surge just after 11:00 am that really amounted to the entire day within about ten minutes. Another Ho Hum session, but an 8 point gain. If we look in side the numbers we find Energy, Financials and Technology lagged the SPX on a relative basis. The Stars were the Materials (not Precious metals), and Industrials. 

USD INDEX DAILY

USD INDEX WEEKLY

DXY was off a bit but moved higher through out the day, its hovering right around the 200wk MA, I wouldnt be surprised if we see it move back up to recent high (81.20), if you look at the TLT its way oversold and that should get a bounce. People are going to look at the yields and now they are more attractive so new money should come into the Bonds, and that will be positive for the DXY and negative for gold and silver but let us not forget that people buy metals in other currencies as well, so the effect on metals wont be as dramatic IMHO.


Yesterday, breadth was strongly positive as might be expected on an up day. Advancing volume was not much stronger in advancing issues. The NYSE Composite Index slightly underperformed the SPX. The breadth data from the NYSE today is rather underwhelming.


The McClellan Oscillator is hanging virtually at zero. This will often happen a day or two before a wide range session. So it is possible we see a large day soon.

 I would love for gold to fall down to the 30wkma  (it would get all the weak hands shaken out), I don't think it will happen because lets face it would be too much of a gift! Right now the 10wk has been support over the past 5 weeks or so and the Gold bears can't break that level down, so keep an eye on that for new purchases.

Silver has had great tests of its 20dma Numerous time and has held up like a champ! It hasn't tested its 50dma once since its breakout in August. This is despite the gyrations in the DXY. The DXY was 80.41 at the time of breakout in Silver and its roughly unchanged while Silver is up more than 50% in that time, so what does that tell you about demand!