Sterling Market Commentary for Tuesday October 2nd, 2012

Sterling Market Commentary for Tuesday October 2nd, 2012

A Look at Monday’s Market:  The overall market was mixed on Monday with the S&P 500 and the Dow Jones Industrial Average finishing the day moderately higher while the NASDAQ finished the day slightly lower.  Among the indices I track there was strength in the Airlines, Natural Gas, Gold/Silver, Biotech,  Insurance, Healthcare related, Commodities, Transports, Retailers, and Financials.  There was weakness in the Telecoms, High Tech, and Utilities.  In the commodities markets,  Oil was higher by $0.29 to $92.48 per barrel, and Gold was higher by $9.40 to $1,780.50 per ounce.  In the Grain markets,  Wheat was lower by $0.182 to $8.842 per bushel, while Corn was higher by $0.004 to $7.566 per bushel, and Soybeans were lower by a whopping $0.406 to $15.602 per bushel.

A Few Thoughts on Tuesday’s Market: In reviewing the charts from yesterday’s trading activity, I did not see any indications of real strength in the market.  The charts with the clear patterns appear to be breaking to the downside.  To me this is a sign of continuing weakness; and it creates a strong belief that if it were not for the market manipulations of the Fed, and if it were not for the Fed manipulating the market it would be a lot lower.

The Dow Jones Industrial Average: The Dow Jones Industrial Average closed Friday at 13,437.13.  I continue to see upside resistance on the Dow at 13,558.92.   With Friday’s close of 13,437.13 the Dow Jones Industrial Average broke our support level of 13,345.  I now see downside support coming in at 13,279.32  Current Expectations:  I am expecting the Dow to continue to move lower and test 13,279.32 on a closing basis.

Dow Jones Transportation Average:  The Dow Jones Transportation Average closed Monday at 4,899.73.  I continue to see upside resistance on the the Dow Transportation Average at 4,951.07 and downside support at 4,873.76  and then at 4,795.28  This is obviously a very narrow trading range.  Current Expectations:  The Dow Transports appear to be in a downward trend.  I am expecting Dow Transports to continue to move lower and test 4,873.76 on a closing basis.

The Bottom Line:  I just do not see any strength to the market, and continue to have concerns about it moving lower.

Sterling Calendars for the Week of October 1st, 2012
Economic Calendar
Date Est.
Release For Consensus Prior
10/01 10:00am ISM Index Sep. 49.7 49.6
10/01 10:00am Construction Spending Aug. 0..4% (0.9%)
10/02 2:00pm Auto Sales Sep. N/A 5.3 M
10/02 2:00pm Truck Sales Sep. N/A 6.3 M
10/03 7:00am MBA Mortgage Index 09/29 N/A 2.8%
10/03 8:15am ADP Employment Change Sep. 133K 201K
10/03 10:00am ISM Services Sep. 53.0 53.7
10/03 10:30am Crude Inventories 09/29 N/A (2.466M)
10/03 2:00pm FOMC Minutes 9/12
10/04 7:30am Challenger Job Cuts Sep. N/A (36.9%)
10/04 8:30am Initial Jobless Claims 09/29 365K 359K
10/04 8:30am Continuing Jobless Claims 09/22 3,273K 3,271K
10/04 10:00am Factory Orders Aug. (6.0%) 2.8%
10/05 8:30am Nonfarm Payrolls Sep. 120K 96K
10/05 8:30am Nonfarm Private Payrolls Sep. 130K 103K
10/05 8:30am Unemployment Rate Sep. 8.1% 8.1%
10/05 8:30am Hourly Earnings Sep. 0.2% 0.1%
10/05 8:30am Average Workweek Sep. 34.4 34.4
10/05 3:00pm Consumer Credit Aug. $5.0B ($3.3B)