Futures Point To A Weaker Open
INTEREST RATES
OVERNIGHT
CHANGE to 04:11 AM:BONDS-5 MARKET CLOSED FOR HOLIDAY!  +Â
#BONDS:
MARKET CLOSED FOR HOLIDAY MARKET CLOSED FOR HOLIDAY *
BOND
TECHNICAL OUTLOOK
#BONDS
(DEC) 11/11/03: It is a slightly negative indicator that the close was lower
than the pivot swing number. Near-term resistance for bonds is at 107.19 and
then again at 108.02, while swing support hits at 106.22 and below there at
106.08. The market’s close below the 9-day moving average is an indication the
short-term trend remains negative.
STOCK INDICES
OVERNIGHT
CHANGE to 04:11 AM:$+1, YEN-20, SF+26, CA-9, EU+12Â
Dollar:
While the normal pit action is closed today due to holiday the overnight Globex
trade in the Dollar is showing minor strength. We have to wonder how the Dollar
has managed to hold up considering that the US equity market is showing almost
no confidence in the US economy. One might suggest that the US Dollar has been
hanging on against the sellers because of the persistent flow of favorable
scheduled economic numbers.
FOREIGN EXCHANGE
EURO:
European stocks were weaker overnight showing the trade that the Euro zone
doesn’t have the economic stats to fend off losses against the Dollar.
Furthermore, the Euro zone doesn’t have the economy to fend off losses against
the Yen and Pound. Therefore, one must expect the Euro to continue sliding
toward the recent lows. We do expect support to be respected down around 114.00
but the bias is down. Standing against a sharp drop in the Euro were favorable
numbers from the German ZEW Index, which showed a sharp rise in confidence in
October.
YEN: The
Yen is slightly overbought and with the Nikkei down sharply overnight it would
seem that a profit taking incentive is present in the Yen. Japanese machine
orders rose and that continues a pattern of recovery that should serve to limit
the corrective tone in the Yen. Certainly the Yen was recently overbought
technically but after a minor correction the Yen should be bought again for an
ultimate return to new high ground.
SWISS:
Seeing the Swiss climb back above 73.49 would be a significant technical
reversal and might signal a near term end to its weakness. Since the market
could keep the pressure on the Swiss maybe short covering will lift prices over
the coming sessions.
POUND: So
far, the Pound has been unable to recover from the rate hike action and that
suggests that some doubt the velocity of the UK economy. In fact, an expanding
UK trade deficit simply adds to the liquidation sense and could send the Pound
down to 165.94 in the near term and to 165.21 later this week.
CANADIAN
DOLLAR: It is positive that the Canadian is holding most of the recent rally. It
is also positive that the Canadian would seem to have little near term
competition from other currencies. Near term support of 75.82 should be
considered a buy zone.
METALS
GOLD: It
would seem that the failure by international equity market in the recent action
is providing a lift to gold prices around the world. While the Dollar has shown
some weakness it has yet to make much of a difference on the charts and will
need to fall below and stay below 93.00 to create some excitement for gold. In
order to see a breakout on the gold charts the December contract would have to
climb above $391.9.
SILVER:
There would appear to be significant overhead resistance in the silver off the
late October consolidation. The late October consolidation is bound by $5.09 to
$5.22 and it would not appear that the market will find much in the way of
support until the $5.00 level. While the bias might seem to be pointing up we
still don’t have a good sense of what the main fundamental focus in silver is.
PLATINUM:
While platinum prices come into the action today in a corrective mode, it would
seem like trend line support at $749.8 in the January contract will manage to
support prices. Unlike the rest of the precious metals markets the platinum
market seems to be driven higher by the prospect of an improving global economy
and a rather tight supply situation.Â
The
copper market would appear to have found decent support around the Monday low
and then respected that level in an early test today. Therefore, the 92.50 level
would seem to be support for the near term but with global equity COPPER:
markets soft, the bulls are lucky to have seen a slight rise in Chinese prices
overnight. The International Copper Study Group pegged the world deficit to be
256,000 tons for the first 9-months of 2003 and that should be supportive to
prices.
CRUDE COMPLEX
OVERNIGHT
CHG to 04:11 AM:CRUDE+13, HEAT+52, UNGAS+45Â Apparently the market wasn’t too
distraught over the Saudi attacks as prices failed to stay strong for the full
session Monday. In any regard, the energy complex remains in a bull market tilt
but is in danger of getting overbought.
NATURAL GAS
The
market continues to flirt with a downside breakout but periodic strength in
crude and mostly cool to cold weather is discouraging the sellers. However, a
mid week warm up might allow the bears a trip into new low ground but it is
possible that the API and DOE reports provide some indirect support to natural
gas prices.