U.S. Indexes Erase Weekly Gains

Posted on by The INO.com Team

Hello traders everywhere. Mid-week things were looking positive for the stock market overall as fears of a long-term trade war with China lessened on news that the U.S. and China began to talk about settling the disagreement. However, weak economic data from China and Europe rekindled fears of slowing global growth, and Johnson & Johnson (JNJ) is leading the lower sustaining significant losses after Reuters reported the company knew for decades that asbestos lurked in its Baby Powder.

weekly loss

All three indexes are suffering losses over 1.3% on the day which has effectively erased the weekly gains that all three indexes were looking to post. The DOW will end the week in negative territory losing almost one percent at -.90%. The S&P 500 will post a weekly loss of around -.80%, and NASDAQ is trying to finish the week unchanged floating between and gain and loss for the week. Continue reading "U.S. Indexes Erase Weekly Gains" →

Is The Fed Done Tightening After December?

Posted on by George Yacik

It’s beginning to look a lot like the Federal Reserve is done tightening, at least after next week’s monetary policy meeting, when it’s expected to raise interest rates another 25 basis points, to 2.5%, its fourth rate hike this year. After that, however, it’s looking less and less likely that it will raise rates at all next year, certainly not four times, which seemed to be the market consensus not all that long ago.

As we know well, Fed chair Jerome Powell told the Economic Club of New York late last month that interest rates are “just below” the so-called neutral rate, a retreat from his comments less than two months earlier that the fed funds rate was a “long way” from neutral. That sparked a big, but short-lived, rally in both bonds and stocks, as it left investors with the idea that Powell and the Fed are going to be a lot less hawkish moving forward in light of still somnolent inflation and now signs of a weakening economy, exacerbated by the recent inversion of some Treasury bond yield curves, which traditionally have been a sign of impending recession.

As CNBC’s Jim “Mad Money” Cramer noted on Monday, the Fed "risks its credibility" if it doesn’t raise rates next week, a move it has been telegraphing for several months. Failure to do so risks setting off a market panic because, as Cramer said, the Fed could create the impression that “there's something really wrong that we don't know about.” So the Fed has largely backed itself into a corner and must go through with it, whether it wants to now or not.

But what about next year? Continue reading "Is The Fed Done Tightening After December?" →

Stocks Jumped On China Trade Talks

Posted on by The INO.com Team

Hello traders everywhere. Stocks jumped higher at the open of trading after news broke that the U.S. and China started the latest round of trade talks with a phone call involving Treasury Secretary Steven Mnuchin, U.S. Trade Representative Robert Lighthizer, and Chinese Vice Premier Liu He. It's been reported by people familiar with the call that they discussed Chinese purchases of agricultural products and changes to fundamental Chinese economic policies.

But the markets soon fell from those highs and have settled in what I would call muted trading today, which is a far cry from the recent volatility.

Stocks jumped

The DOW finally joined the red monthly Trade Triangle club issuing a new one at 24,122.23 on Monday when it traded below 24,000 for the first time since June 28th of this year. Not to be outdone the S&P 500 issued a new red weekly Trade Triangle at 2,621.53 pushing the Chart Analysis Score to -100 once again. The NASDAQ remains in a sidelines position with a red monthly Trade Triangle and green weekly Trade Triangle. A move below 6,830.76 will trigger a red weekly Trade Triangle indicating that a move lower could be ahead. Continue reading "Stocks Jumped On China Trade Talks" →

Gold & Silver: US Dollar Could Spoil Santa Claus Rally

Posted on by Aibek Burabayev

Here we are on the final track of the year, and investors hope for the traditional Santa Claus rally in the precious metals sector. This euphoria of the anticipated strength based on the current move up could be spoiled if this pattern would emerge in the US dollar index (DXY).

Chart 1. US Dollar Index Daily: Triangle

US Dollar
Chart courtesy of tradingview.com

The disappointing data of US non-farm payrolls released last Friday couldn’t damage the US dollar as it kept above the former trough established on the 4th of December at 96.30. The first reaction in the market was a USD sell-off against all major currencies, but it was short-lived, and none of the former extremes were breached. This made me focus on the Dollar Index chart to see if there is some pattern or trading setup has been shaping amid this unusual market behavior. Continue reading "Gold & Silver: US Dollar Could Spoil Santa Claus Rally" →

Weekly Futures Recap With Mike Seery

Posted on by The INO.com Team

We've asked Michael Seery of SEERYFUTURES.COM to give our INO readers a weekly recap of the Futures market. He has been Senior Analyst for close to 15 years and has extensive knowledge of all of the commodity and option markets.

Michael frequently appears on multiple business networks including Bloomberg news, Fox Business, CNBC Worldwide, CNN Business, and Bloomberg TV. He is also a guest on First Business, which is a national and internationally syndicated business show.

Gold Futures

Gold futures in the February contract is currently trading at 1,252 after settling last Friday in New York at 1,226 up about $26 for the trading week breaking out to a five-month high. Money flows are coming out of the U.S equity market which is sharply lower once again today while now entering the precious metals across the board as I am looking closely at a bullish position in silver as well as it seems to me that the precious metals are going higher. I am now recommending a bullish position from around the 1,252 level and if you're going to take this trade place the stop loss under the 10-day low which now stands at 1,216 as the risk is around $3,600 per large contract plus slippage and commission or about $800 per mini contract. Gold prices are trading above their 20 and 100-day moving average as the trend is clearly to the upside as this commodity is used as a flight to safety as investors are getting spooked by the volatility in the S&P 500 while taking money out of that sector and heading into gold. The chart structure will start to improve later next week as the monetary risk will also be lowered as the volatility remains relatively low with the next major level of resistance all the way up around the 1,275 level as I think there is room to run as I have not recommended a gold position for quite some time
TREND: HIGHER
CHART STRUCTURE: IMPROVING
VOLATILITY: LOW
Continue reading "Weekly Futures Recap With Mike Seery" →