Today is Monday, but its the last day of the month. So far we have had two sided trade, with highs actually being posted overnight in most of the markets. We have had a rally in bank stocks after calmer heads have seemed to prevail over the bank of Dubai mess. One thing you cant’ argue with, is at least they can’t just print the money. All they have to do is pump the oil. Seems like people realized that over the long haul, that means they’ll either get their money, or they’ll get 40 dollar a barrel oil, until the 60BB is paid off. Either way, we seemed to have dodged a potential bullet, as these markets have been sniffing for a reason to reverse course and prove the bears (who have been soundly thumped for the last 9 months) finally right. The old expression, “Even a broken clock is right twice a day” comes to mind.
The bears will have their day. Its only a matter of time. For now, it seems, that they may be kept at bay by the bulls.
So far today, we have had a 20 dollar trading range in gold, with a high at 1183.70 and a low at 1163.70. Honestly, 1183 is only a hop away from 1200.00 and I can’t believe that the bulls will miss a chance to get that print out between now and the end of the year. People will have to have something to grouse about at their Christmas Parties. 1200 dollar an ounce gold would fit the bill, I think.
The stock indexes post their highs overnight and have been trading in a two-sided range most of today. There was some better than expected economic news for the Mid West Manufacturing Index today, which served as fodder for the bulls. DJZ has had a 115 point trading range, pretty typical, and the day is young. Generally a 200 point range gives us more opportunity to catch a move either way and get paid for our patience. We have been watching the crude as well, as it has had a two dollar trading range. Crude had a high at 7693 and a low at 7513. SPZ has a high so far at 1098 and a low at 1084. ( a 14 handle range for some opportunity).. DJZ posted a high last night at 10367, about five minutes after the 5PMCST opening. So far we have a low today at 10251, and are currently bouncing around the 10,300 level.
Just like 1200 in the gold, I still think a settlement above 10,500 is something the bulls will shoot for between now and the end of the year.
Holiday markets are thin, and believe it or not, its hard to maintain shorts in such a thin market. We tend to have nasty short covering rallies in the afternoon during this time of year. The indexes may trade lower until about 2PMCST, but once the bond futures are closed, the indexes are out there on their own. That 2PM CST trading hour is sometimes the best opportunity of the day, because the hedge is gone with the bond market at rest.
In the grains, Wheat is our leader today so far, up 12 cents at 561, corn is still hemmed in with CZ bouncing off resistance at the 400 strike price. Jan beans are up 6 cents trading around the 1055 level. Last night we went up to the old high at 1066, but couldn’t pop above it. We may see a run at that level later on today, however, as SF explores a nice 15 to 20 cent trading range. Last Thursday night’s low at 1021 is looking like a gift to the bulls we might not see for a bit.