Sterling Market Commentary for Wednesday November 21st, 2012
A Look at Tuesday’s Market: The overall market finished Tuesday mixed as did the major market indices with the Dow Jones Industrial Average and the NASDAQ 100 finishing lower while the S&P 500 was slightly higher. It was pretty much a lackluster trading session with the not much to note with the exception that we may be seeing a rally in the Banking and Biotech indices, while the Gold/Silver and Utilities remain under pressure. In the commodities markets, Oil was lower by $2.53 to $86.17 per barrel, and Gold was lower by $10.80 to $1,723.60 per ounce. In the grain markets, Wheat was higher by $0.032 to $8.450 per bushel, and Corn was higher by $0.044 to $7.432 per bushel, while Soybeans were higher by $0.18 to $14.126 per bushel.
A Few Thoughts on Wednesday’s Market: In looking at the charts from yesterday’s trading session, I did no see anything that really stood out. This is the last full day of trading of a holiday shortened week. My expectations are that like most days before a shortened week or extended holiday weekend, we will see traders looking to flatten out their positions. As a result, I am looking for another flat to slightly downward trading session. However they are shooting at each other in the Middle East and that could all change on a moments notice; additionally the bailout of Greece may have hit a snag and the market may suddenly decide that is important. However, like Eddie Murphy in trading places, I think everyone is looking forward to having the rest of the week off. So I am expecting a slow market today.
The Dow Jones Industrial Average: The Dow Jones Industrial Average closed at 12,788.51 With the change over to decimalization of quotes and the increased use of computerized trading, support and resistance levels are not always as solid as they used to be. As a result they can be temporarily violated for a day or so before regaining their importance. Despite the fact that the Dow Jones Industrial Average closed above my upside resistance level 2 days ago, I am going to maintain my current upside resistance level on the Dow Jones Industrial Average for an another day or so to see if it the Dow moves back below it or not, and if I need to raise it or not. I still see upside resistance on the Dow Jones Industrial Average at 12,715.93 on a closing basis. I now see downside support coming in at 12,118.57 on a closing basis. Current Expectations: I think we are starting a new trend lower in the Dow. I am expecting the Dow Jones Industrial Average to continue to move lower and test 12,118.57 on a closing basis.
Dow Jones Transportation Average: The Dow Jones Transportation Average closed at 4,982.94 I continue to see upside resistance on the the Dow Transportation Average at 5,215.97 and downside support at 4,873.76 and then at 4,795.28. Current Expectations: I think the Dow Transports are going to track sideways between support and resistance for the foreseeable future.
S&P 500 ‘SPX’: The S&P 500 closed yesterday at 1,387.81 I currently see upside resistance on the S&P 500 at 1,405.82 and downside support on the S&P 500 at 1,343.36 and then at 1,334.76 Current Expectations: I think the S&P 500 is going to move lower and test 1,343.36 and then 1,334.76 on a closing basis.
NASDAQ 100 Index ‘NDX’: The NDX closed yesterday at 2,594.66 I see upside resistance on the NDX currently at 2,623.33 and downside support at 2,458.83 on a closing basis. Current Expectations: I think the NDX is going to continue to move lower and test 2,458.83 on a closing basis.
The Bottom Line: I think the market will continue to move lower for the next few trading sessions.