Security ‘Blanket’ Is Gone
I am writing this piece before I leave for Las
Vegas, however, the TV in the background is active with news
emanating from Israel. While it is far too early to tell what the outcome will
be by the time the market opens on Monday morning, the early indications are,
that what little stability existed in the region has been completely removed.
This situation may very well be the catalyst which triggers some downside
price action which the VIX has been predicting for some time. I will not be able
to trade on Monday morning, but unless there is some resolution, I would expect
some intense volatility.
Monday will also mark the first day in which Japanese banks will suspend
“blanket” deposit insurance. This has been pointed to as one of the
several reasons why gold has been performing well lately. Japanese citizens are
purchasing gold (hard asset) instead of paper assets like stocks or bonds. The
incredibly shaky banking system adds further concerns. How it will play out is
anyone’s guess. But the week ahead may offer some insight.
Key Technical
Numbers (futures):
S&Ps |
Nasdaq |
| 1163-64 | 1490-93 (big resistance) |
| 1159 | 1485 |
| 1153 | 1473-75 |
| 1146 | 1460 |
| 1139 | 1444 |
| 1136 (critical support) | 1436 (critical support) |
| 1129 | 1422 |
| 1126 | 1405 |
| 1115.8 | 1386 |
| 1112 | 1366 |
As always, feel free to send me your comments and
questions. My column will resume on Wednesday, April 3.