(The Weekly Digest reproduces the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers.)

MARKETS SPIKE ON EUROPEAN BANKING DEAL

June 29, 2012

Italy’s Mario Monti led the charge to convince Merkel of Germany to radically restructure bank aid.

It was not long ago when there was hardly even a whisper in the media on the subject, we alerted you that the bank deal in Europe was in the works. Now the first positive step has become reality.

Knowing that this deal was in the works, we have been cautioning against short selling on market lows. Yesterday market was down 179 points when it exploded to the upside on a rumor. This morning shorts are losing their shirts as the markets are much higher on a short squeeze.

Under the deal, ESM will be able to make direct injection of capital into weak banks. Previously money could be lent only to the government of a country.

This deal breaks the vicious circle between sovereigns and banks.

A lot more still needs to be done, and the size of the bailout fund is small. For these reasons, unless there are more positive statements from European leaders, the rally may fizzle.

Today is the last day of the month and the quarter, expect window dressing.

Gold futures are at $1586, silver futures are at $27.48, and oil futures are $80.72.

S&P 500 resistance levels are 1348, 1352, and 1358; support levels are 1339, 1330, and 1324.

DJIA futures are up 161 points.

OBAMA CARE D-DAY, TURKEY WEAPONS TO BORDER, AND THE EUROPEAN SUMMIT

June 28, 2012

The Supreme Court is expected to announce its decision on Obama Care at 10:00 am ETS.

Heavily armed Turkish military units are moving toward the Syrian border.

Rumors from the high stake European summit abound.

Expect high volatility.  When properly used, volatility is an investors friend as it generates opportunities.

Gold futures are at $1571, silver futures are at $26.92, and oil futures are $80.66.

S&P 500 resistance levels are 1324, 1330, and 1339; support levels are 1312, 1300, and 1296.

DJIA futures are down 82 points.

300-500 POINT SWING IN THE STOCK MARKET POSSIBLE

June 27, 2012

European summit starts tomorrow. Based on the results of the summit 300-500 DJIA points in the stock market is possible. The movement can take place in either direction.

The market has come down and expectations from the summit are low, therefore the probability of an up move is higher than the probability of a down move.

It is best to keep some powder dry.

The pre-market is in the risk off mode. Gold and silver are acting as risk assets contrary to the traditional role of a hedge against risk.
Gold futures are at $1568, silver futures are at $26.89, and oil futures are $79.62.

S&P 500 resistance levels are 1324, 1330, and 1339; support levels are 1312, 1300, and 1296.

DJIA futures are up 4 points.

AMBITIOUS PLAN SPROUTING IN EUROPE

June 26, 2012

There are reports that in the upcoming European summit, there will be discussions on a draft plan under which Brussels will become a de facto finance ministry for eurozone members.

Expect markets to be volatile based on rumors about the rumor and news about the European summit and Obama Care.

Gold futures are at $1579, silver futures are at $27.26, and oil futures are $79.05.

S&P 500 resistance levels are 1312, 1324, and 1330; support levels are 1300, 1296, and 1287.

DJIA futures are up 22 points.

JITTERS AHEAD OF THE EUROPEAN SUMMIT AND OBAMA CARE DECISION

June 25, 2012

The Supreme Court is expected to rule on Obama Care this week.  pharmaceutical stocks are especially weak n the pre-market.   Hopes are waning that European leaders in the upcoming summit this week will take decisive action.

Gold futures are at $1572, silver futures are at $26.71, and oil futures are $78.91.

S&P 500 resistance levels are 1324, 1330, and 1339; support levels are 1300, 1296, and 1287.

DJIA futures are down 99 points.

 

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