Daily US Market Comments 01 Dec 2006 by MastersoEquity.com
FUNDAMENTALS
A slew of unfavorable economic data and rising oil prices left the market relatively unchanged yesterday. Core-PCE deflator was higher than expected, Chicago PMI fell to the lowest in 3 years and a slight rise in inflation index to 2.4% all add up to additional pressure on a bull run that is currently under siege by a returning oil price. Oil closed uncomfortably near $63 yesterday suggesting that a full scale rebound has started until we see otherwise. Looks like all that OPEC measures are beginnin to see some effect after one long month. We will have to observe and watch what the market does next as a market under such conditions can go anywhere indeed.
TECHNICALS
Markets moved sideways yesterday without any surprise. Looking at the major indices, we can see that every short 3 to 5 days move up are littered with dojis and neutral days in between like the one we saw yesterday, that is why it comes with no surprise. The only concern we see here is that oil has made a definite break to upside from its neutral channel and has followed up on that break all the way yesterday. Our trend indicator on oil has also seen the first shift to bullish in almost 5 months. The current market bull run has been in symmetry with the drop in oil price since August... will the turnaround in oil price signal the end of a nice bull run? There are no indications yet but we should all keep a close lookout. I would think that the end of the market bull run will be signaled with a huge single day drop like we saw on 17 Nov, along with a surge in oil price, and then followed up the next day with a large drop second to the one on 17 Nov, breaking the uptrend trendline to downside.
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A slew of unfavorable economic data and rising oil prices left the market relatively unchanged yesterday. Core-PCE deflator was higher than expected, Chicago PMI fell to the lowest in 3 years and a slight rise in inflation index to 2.4% all add up to additional pressure on a bull run that is currently under siege by a returning oil price. Oil closed uncomfortably near $63 yesterday suggesting that a full scale rebound has started until we see otherwise. Looks like all that OPEC measures are beginnin to see some effect after one long month. We will have to observe and watch what the market does next as a market under such conditions can go anywhere indeed.
TECHNICALS
Markets moved sideways yesterday without any surprise. Looking at the major indices, we can see that every short 3 to 5 days move up are littered with dojis and neutral days in between like the one we saw yesterday, that is why it comes with no surprise. The only concern we see here is that oil has made a definite break to upside from its neutral channel and has followed up on that break all the way yesterday. Our trend indicator on oil has also seen the first shift to bullish in almost 5 months. The current market bull run has been in symmetry with the drop in oil price since August... will the turnaround in oil price signal the end of a nice bull run? There are no indications yet but we should all keep a close lookout. I would think that the end of the market bull run will be signaled with a huge single day drop like we saw on 17 Nov, along with a surge in oil price, and then followed up the next day with a large drop second to the one on 17 Nov, breaking the uptrend trendline to downside.
We Made 97% Profit Yesterday On Our Stock Pick Service! Did You Miss It?
posted by Jason Ng at 7:12 PM
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