Metals Commodities Bonds Dollar

Since I have a bias towards the risk or inflation trade (the primary reason for starting this blog) i'm am hopeful that copper is signaling that quantitative easing coming in some way shape or form. There are lots of big money managers who feel that QE will not end today. They may put lipstick on that pig and may call it something else but we all know Bernake is a deflation hawk so to speak and he will push money into the system. Copper maybe signaling something to that nature. Cu is certainly can not be signaling that the economy is growing. 

Since options expiration day silver has started to rally, its also getting a boost as the dollar has been selling off as have bonds. Everything seems to be perfectly coordinated. what does it all mean. Of course these markets aren't manipulated. 

Gold didn't sell off as much as silver not by a long shot and its not bouncing as hard as silver is. According to some this means traders are will to take more risk. 

These moves look to good to be true. I have my finger on the trigger a lot of people are expecting reversals this week. Keep an eye on the long bond,  it paved the way for this rally and it can take it all back in a blink.

If oil can get above the 200dma and build a base above it (or breakout), it will make me feel better about all commodity assets. 

S&P 500 Recap and A Look Inside the Markets

Good morning SPX futures are up slightly after a really nice follow through day yesterday. We have claims data at 830 and chi PMI at 945am. Yesterday' session opened with a nice gap higher over the down trendline before pulling back to put the low of the day on the chart during the opening hour. But buyers kept coming in at a good pace albeit into the light volume summer trading and pushed the SPX up ten points before trading settled into a three point range for three hours. Just before 2 pm the market began a sharp nine point downward move but news that was bullish for banks propped the SPX back up and the index closed at the highs of the day.              

367 components advancing and 104 components declining. On the NYSE 3,147 issues were traded with 2,121 advancing issues and 926 retreating issues, a ratio of 2.29 to one advancing. There were 81 new highs and 14 new lows. The five day moving average of New Highs is 57 while the five day moving average of New Lows is 33 and the ten day moving average of Net Advancing is 601. The Net Advancing data indicates a bullish trend.

Powerful breadth again, along with a strong advancing volume ratio. The TRIN is just starting to call for a pullback while the NYSE Composite Index was stronger than the SPX, and that my friends is very bullish

Wednesday’s volume was a heavier than Tuesday's volume but still lighter than even the typical summer volume. One of the largest surges of volume came on the mid afternoon sell-off. Breadth Indicators remain bullish looking but the McClellan Oscillator remains firmly in overbought territory at the highest level since May 2nd when the correction was just beginning. So why this rally, I think its all about bonds, as long as money is coming out of bonds the risk trade is back on!

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Silver starting to outperform gold

by Dan Norcini


One can see the concerns over the Greek debt situation through the price action of this ratio chart. As traders became convinced the last few days that Greece will get the bailout and their government will approve the austerity program, the ratio has moved lower with silver outperforming gold.

Lingering fears however concerning the well-being of several other Euro-zone countries, is keeping safe haven buying coming into gold and that has kept the ratio from dropping too severely right now. 

I would watch to see the 40 level to see whether it holds or not. A break through this level accompanied by a sharp move lower in the long bond would indicate a shift back towards inflation fears on the part of traders/investors. Discerning any clear trend in these extremely volatile and illiquid markets at this time is an exercise in futility given the erratic price action.

ORIGINAL SOURCE

Big moves in stocks and commodities and bonds slide

Robin Griffiths says the silver lows are in, time to buy is now Original Source 

James Turk thinks were gonna have a historic summer for gold prices Original Source

Bonds extend losses, stocks are back in favor

RISK ON 

Bonds Dollar Metals Markets

Good morning everyone, S&P futures are up 9 points right now, and we may open above the downtrend line. Could we get 4 straight days of selling in the bonds. Its no coincidence that stocks are rallying. I have been writing for a few days now that bonds are in a topping pattern. Looks like risk maybe back on.

Greek lawmakers are expected to vote today and tomorrow on the austerity measures, which must be passed in order to receive the next payment of its bailout. If the government does not pass these measures, Greece could default on its debt, possibly sparking a Europe-wide crisis and potential credit market freeze. Looks like the markets are betting that there wont be a default.

Meanwhile yesterday demonstrators gathered in central Athens at the start of a 48-hour strike to protest the measures. According to the Case-Shiller home-price index home prices in major U.S.cities gained for the first time in eight months. The index dipped 0.1 percent on a non-seasonally adjusted basis while the index gained 0.7 percent after a seasonal adjustment. So the actual numbers dropped but after adjusting showed a gain.

Tuesday's session opened with a significant gap higher and then proceeded to run higher from wire to wire with only minor pullbacks along the way. But the SPX netted a gain of a mere four points after the end of the first hour while still managing to close at the highs.For the SPX Index there were 427 components advancing and 50 components declining. On the NYSE 3,163 issues were traded with 2,457 advancing issues and 605 retreating issues, a ratio of 4.06 to one advancing. There were 75 new highs and 23 new lows. The five day moving average of New Highs is 54 while the five day moving average of New Lows is 34 and the ten day moving average of Net Advancing is 270. The Net Advancing data indicates a bullish trend.

Tuesday’s volume was less than Monday's volume as volume continues to slide lower since last Thursday. There is really nothing significant that can be gained from examining our intraday volume pattern. But the advancing volume was spectacular. Breadth Indicators have turned bullish looking but the McClellan Oscillator has now moved firmly into overbought territory.


Look at the chart to the right, I had pointed out that the bonds were in a topping formation and now they are rolling over. I'm looking for this rally to continue as long as the bonds fall. Bonds have a lot of room to fall and yields to rise.

Dollar is also looking like it wants to take a break. And all of this is short-term bullish for our beloved PM's other commodities. Just looking at these charts and knowing full well its too early to get excited but maybe we are out of risk off trade for a while. Fingers on the trigger.

I wanted to highlight the dates for options expiration in Silver, they have pointed to turnarounds in Silver prices just take a look at the rallies. Things are lining up well for Silver hoping it breaks out above the trend line

Rest of the charts are self explanatory. Everything commodity related is trying to find a bottom or reason to rally QE3 announcement coming soon. You know the Fed gives JPM and GS the heads up so they can position themselves the right way. So lets see if we get a call out of one of those mafia families.

S&P 500 Recap and A Look Inside the Markets

Not much news out this morning, futures are flat, I found this article from Bloomberg June 23rd, supports what I have been thinking in terms of QE3.

Former Federal Reserve Bank of Richmond President Alfred Broaddus talks about necessary conditions for the central bank to consider another round of asset purchases and the ability of the Fed to reverse its policy of quantitative easing and remain ahead of inflation trends. Broaddus speaks with Tom Keene on Bloomberg Television's "Surveillance Midday." (Source: Bloomberg) 00:00 Bernanke's second news conference 00:49 Necessary conditions for QE3 02:17 Structural unemployment and policy 03:32 Challenge of unwinding Fed balance sheet 04:58 Ability of Fed to stay ahead of inflation 06:07 Debt needs "credible long-term strategy."

Yesterday, the Greek parliament was debating a fresh austerity package but the government is fragile and analysts believe that it may not pass. Consumer spending was largely unchanged in May for the first time in almost a year, according to the Commerce Department. The flat reading in consumer spending came after 10 straight months of gains and followed a downwardly revised 0.3 percent gain in April. Economists had expected spending to gain 0.1 percent. When adjusted for inflation, spending fell 0.1 percent in May, declining for a second straight month. Spending on durable goods fell 1.5 percent after being flat in April. Futures were flat as the opening approached as traders remained cautious about Greece's future.

Monday's session opened without a significant gap and a dip quickly put the low of the day on the chart in the opening minutes. There were four distinct surges higher throughout the day, putting the high on the chart just before 3:00 pm. But the closing hour saw a modest four point give-back as the SPX closed in the upper 30% of the intraday range.



For the SPX Index there were 400 components advancing and 73 components declining. On the NYSE 3,145 issues were traded with 2,089 advancing issues and 969 retreating issues, a ratio of 2.16 to one advancing. There were 52 new highs and 39 new lows. The five day moving average of New Highs is 53 while the five day moving average of New Lows is 35 and the ten day moving average of Net Advancing is 288. The Net Advancing data is indicating a bullish trend. Powerful market breadth today with the ten day Net Advancing finally indicating a bullish trend. This is the first time in June that this has been true. Volume was light and the NYSE Composite was relatively weak, so there are warning flags visible.


Monday’s volume was less than 80% of Friday's volume (which was less than 75% of Thursday’s volume.) There is certainly a lack of enthusiasm within the market but the largest volume surges today came on market up moves. The Breadth Indicators are mixed but more bullish than we have seen lately. The McClellan Oscillator barely ticked into positive ground today, suggesting that the market could have a lot of room to run higher.

Dollar PM's, Bonds

This is a big week for the dollar and metals I think, FED has to do something, the markets are in a mess .  Or the FED may bring more pain.

Volatility expansion to the downside, there will be no upside until the fed signals easing or the US defaults on debt.  If they don't inflate their way out of this mess then they will surely default.

Looking for downside this weak in long bonds, mature topping pattern

Friday Recap "A look inside the market"

Good morning, futures are up four points and there isn't really any significant news out at the moment. On Friday the futures were up as much as seven points overnight but had fallen back to flat as the open approached as fears of a Greek default returned and Thursday’s closing euphoria evaporated. A sudden drop by Italian banks caused trading to be halted in the shares and that seemed to unnerve traders.

Friday's session opened without a significant gap but the high of the day was the open. Twelve points were gone before 11:00 am at which point the SPX found some support and consolidated until about 1:00 pm when a five point bounce tried to rally the index. But bears quickly turned this back and the last two hours of the week worked gently lower as the low of the day was put on the chart just before the close. Bulls have to be unnerved by Friday’s action as this is not the normal response to a reversal such as we had on Thursday.

For the SPX Index there were 79 components advancing and 398 components declining. On the NYSE 3,140 issues were traded with 1,089 advancing issues and 1,941 retreating issues, a ratio of 1.78 to one declining. There were 49 new highs and 38 new lows. The five day moving average of New Highs is 49 while the five day moving average of New Lows is 38 and the ten day moving average of Net Advancing is 143.

Friday’s volume was less than three quarters of Thursday’s volume. This large of a drop in volume seems significant and suggests less enthusiasm for the bears than the price action suggested. The Breadth Indicators are mixed but more bearish than bullish. The choppy up and down range bound trading appears to have many of the indicators simply stalled.

The negativity in the breadth is obvious,its hard to see any any bright spots but tend day average of Net Advancing remains positive and TRIN is suggesting a bounce. And the NYSE Composite Index outperformed the SPX. A few bright spots for the bulls to hang their hopes upon.