For the YM emini futures (DIA, quote) contract there is only one game in town at present from a technical perspective, and that’s the resistance level just below the 17,800 region which like a tropical storm, continues to build in strength and develop as the days pass to weeks, and the weeks to months.
In my post of 5 days ago I highlighted how a confluence of factors had the potential to drive oil prices even lower, and down towards the $32 per barrel regions, last seen in 2009.
Whilst the spotlight of the metals complex generally focuses on gold whose demise has been relentless, silver too is following the same path lower, and whilst yesterday’s price action for the industrial metal was less dramatic than for gold, the price action this morning has opened up the same technical weakness now self apparent on the daily gold chart.
These are interesting times for oil traders and speculators with Friday’s OPEC meeting in Vienna now on the horizon, and the question that will then be answered is whether the group will cut output to stem the supply glut that is now increasingly having to be held offshore around the oceans of the world.
For US equity markets, and the YM emini in particular, it is the daily chart which has focused the mind over the last few weeks, and the prospect of whether or not the sustained resistance level that has developed in the 17,850 region would be breached, or whether this would ultimately cap the Santa Claus rally and bring it to a shuddering halt.
We have all heard of the Fosbury flop which revolutionized the sporting world of high jumping, but sadly the same could not be said of Janet yesterday who delivered their equivalent effort of the FED flop.
One of the many factors used to decide whether a central bank should or should not raise interest rates is inflation, of which energy is a main contributor, and given the extended bearish trend for oil prices at present this aspect of the decision making process is likely to remain sharply in focus.
With the Nikkei having fallen over 2% at the start of a new trading week and month, European and London traders could be forgiven for thinking their respective markets and Globex would simply follow suit.
The traditional and seasonal Santa Claus rally appears to have come rather early this year, with October’s rally for the NQ Emini (QQQ, quote) recording a sensational month of gains following the equally dramatic events towards the end of August which saw the index correct sharply, before strong stopping volume duly appeared to prevent the market falling further.
As the month of October draws to a close, and with the ghouls and ghosts of Halloween preparing to frighten and alarm in equal measure, it is the trick or treaters at the
