There are two stories this morning that have impacted the early trading.. the first a report that inflation in the UK printed 4%, much higher than the expected 3%. This bit of news ran the Gold trade $10 higher, and moved Silver up to 30.78.
In addition, the Empire Manufacturing Index rose 3.5 points to 15.4, which is received as good news. But again, the real impact data was reported in later paragraphs. Prices Paid rose to 2 and 1/2 year highs, as Prices Received was unchanged, again anticipating margin pressure and smaller profits ahead. Sales figures also disappoint as Advance Sales printed at 0.03 vs expectations of 0.05 while inventories increased again, reaching highest levels since April., 2010
Oil is trading higher at 85.20 and the remaining commodity complex is mixed. The Euro retreat is temporarily halted, trading up at 1.3517, while the Dollar retreated a little, trading at 78.49. The debt markets are little changed this morning, with the 10 year Note trading lower at 3.625 and the long Bond also trading off at 4.674.
Lots of talk in the TA press, with concern again growing that Mr Market is losing momentum.. but that has been our song since 1/20/2011. Our Proprietary Momentum Change Indicators are still working with the Sell signal of 1/20 and the confirmation of 1/28. Our indicators have moved from neutral back toward confirmation of the Sell since Friday last, and if the market today continues the decline started this morning, we may get a confirmation, in which case we will have some new trade ideas.
And don't forget that we have several timing tools looking for a top this week. Although these tools have not been as perspicacious in recent months as they have in the past, they should of course be considered. (I kinda like big words!)
The Dow is off 0.43% at 12215.74 and the SPX is down 0.41% at 1326.51. The rest of the major indexes are mixed, with the TRAN up 0.10% at 5212.93 and the XLF up 0.18% at 17.13
Watch for a Trade ALERT this afternoon.
Best to Your Trading!
Bill
Is your momentum indicator ever posted in a picture here? If not, I suspect that a picture might give it away. It's just that it would be interesting to see a picture of it compared to market action. Is it something you put together in a spreadsheet or is it proprietary settings on a charting service?
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