Pre-Market Brief

Good morning. Today is a big day. The last big econ/news event of the year, with the FOMC announcement at 12.30pm, and a Bernanke press conference around 2.15pm. How the market reacts today, will likely shape how we close the year..and move into 2013.


sp'60min

sp'daily5

Summary

Futures are a touch higher, sp +2pts, we're set to open around 1429/30.
--

As is usually the case, the first market reaction is not often the one that will be the eventual outcome.

We could easily ramp dow 100pts on the news, only to close -150pts. Similarly, we could initially drop 100pts, but close 200pts higher.

There will very likely be some wild swings this afternoon, and those initial moves..are not to be relied upon.

Good wishes for what will be an important day.

Still back testing the old broken support?

Today's moderate index gains were really hard to stomach, not least with the brief break into the 1430s - level we've not seen since the post election snap lower. It remains very possible we are still in the process of back testing the (now broken) rising support from the Oct'2011 lows.


sp'daily3 - news to come

sp'weekly2, rainbow

sp'monthly3, rainbow

Summary

The Sp' closed @ 1427, although it did trade as high as 1434. I was occasionally checking the monthly rainbow (Elder Impulse) charts through today, and despite the gains, they held their provisional warnings, via blue candles.

So, despite the latest mini ramp from sp'1398, we have still not lost the weakness as indicated on most of the monthly rainbow index charts.Yet, any bear out there really should still be seeking a monthly close under the 10MA, which today is sp'1396.


The FOMC

Tomorrow's FOMC announcement will be the last scheduled major econ/news event of the year.

I will note..(for probably the thousandth time)...the 45bn of t-bond buying - which some are still touting as 'QE4', was already announced at the September FOMC, and I'm sure the Bernanke will follow through with his original statement of intent.

So..as at January 2013, op-twist will have ended (due to lack of short term bonds to sell), and the Fed will be printing out of thin air..85bn a month. 40bn for MBS, and 45bn for US Govt. t-bonds. That works out at a big 1 trillion per year.

Unless I'm mistaken, didn't the clown finance TV cheer leaders all proclaim the 'summer of recovery' in 2009? In which case, why is the Fed now about to ramp printing to an annual 1 trillion?

Oh that's right, the cheer leaders were lying..or were plain delusional. I hope its merely the latter.

Goodnight from a foggy*..and very icy London
--

*that's a bullish buy signal...right?

Daily Index Cycle update

The main market closed moderately higher. The opening gap over the recent sp'1423 high was very damaging to all near term bearish outlooks. Despite late day weakness, the closing gains are yet more salt in the wounds of those bears who have been re-shorting across the past few weeks.


IWM

Dow

Sp'daily5

Trans

Summary

Clearly, it was a rough day in the bear bunker. The opening gap right over the sp'1423 high (from last Monday) was always a threat, and once that occurred, then the algo-bots were merely able to melt everything higher into the mid 1430s.

Lets get this clear, there is NO sign of a turn lower, or even levelling out yet.

The hourly charts held within their ascending channels, and thus no one - not least yours truly, can claim the immediate trend is anything other than UP.
-

The FOMC announcement is tomorrow at 12.30pm, with the Bernanke due to hold a press conference around 2.15pm. How the market reacts to both of these, will very likely shape how we trade into early 2013.

A little more later