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

OIL SURGES AS RUSSIA FLEXES ITS MUSCLE IN SYRIA, BUT GOLD FALLS

May 17, 2013

Crude oil is surging.   WTI just hit session high of $96.41.  Russian war ships are patrolling waters near Syria.  This is perhaps meant as a warning for the United States to stay out of Syria.

Gold would have been expected to rise but is still falling.

Michigan Sentiment will be released at 9:55 am and leading indicators will be released at 10:00 am.  These may affect the stock market.  In the meanwhile, bulls are in firm control of the stock market.

Gold futures are at $1377, silver futures are at $22.60, and oil futures are $96.30.

S&P 500 resistance levels are 1675, and 1700; support levels are 1635, 1625, and 1607.

DJIA futures are up 49 points.

JAPAN GROWTH SURGES, GOLD FALLS

May 16, 2013

Japanese GDP increased at 3.5% annualized rate compared to 2.7% consensus.  Japan grew faster than any other G7 country.

In the U. S.  Consumer Price Index  (CPI) fell 0.4% month over month; consensus was a fall of 0.2%.

Falling inflation should mean lower prices for gold and that is true this morning.

Stocks remain overbought but firmly under the control of the bulls.

Gold futures are at $1378, silver futures are at $22.43, and oil futures are $94.78.

S&P 500 resistance levels are 1675, and 1700; support levels are 1635, 1625, and 1607.

DJIA futures are down 13 points.

MOSTLY AIR UNDER AND OVER THE STOCK MARKET

May 15, 2013

The stock market is at a place where there is mostly air both under and over the market. Going back 30 years and back testing, the results are conclusive – aggressive buying or short selling is a mistake at this time.  The best course of action is selective buying, selective shorting and selective profit taking.

Core Producer Price Index (PPI) came at 0.1% vs. 0.1% consensus.  Empire State Manufacturing number came at -1.43 vs 3.5 consensus.  Together these numbers point to disinflation and deflation.

Gold and silver are falling.

Gold futures are at $1410, silver futures are at $22.90, and oil futures are $93.11.

S&P 500 resistance levels are 1650, 1675, and 1700; support levels are 1635, 1625, and 1607.

DJIA futures are down 12 points.

A BIG POSITIVE DEVELOPMENT IN EUROPE

May 14, 2013

Part of the problem in Europe has been that there is not a good mechanism to supervise banks and resolve situations when banks run into trouble.  In the past, most of the opposition to doing anything that is practical has come from Germany.  Jörg Asmussen, a German member of European Central Bank, is saying that he favors a swift creation of a single European resolution regime.

This is a change and is likely to lead to many opportunities in European banking stocks in the near future both on long and short sides.

The stock market continues to levitate.

Gold and silver are weaker.

Gold futures are at $1424, silver futures are at $23.22, and oil futures are $94.86.

S&P 500 resistance levels are 1635, 1650, and 1675; support levels are 1625, 1607, and 1600.

DJIA futures are up 4 points.

RETAIL SALES FALL LESS THAN EXPECTATIONS, GOLD FALLS ON SLOWING DEMAND FOR PHYSICAL GOLD IN INDIA

May 13, 2013

Retail sales ex-auto were expected to fall 0.2% but they fell only 0.1%.  This simply means that the American consumer kept on shopping in April. This means stronger economy which may lead to higher interest rates.  Therefore bonds are weaker this morning.

The U. S. dollar is stronger.  Gold is weakening on reports that demand for physical gold in India is less than expectations.

Stock market is slightly weaker even though the news is good for the market.  It is simply that the market is overbought.

Gold futures are at $1432, silver futures are at $23.65, and oil futures are $95.20.

S&P 500 resistance levels are 1635, 1650, and 1675; support levels are 1607, 1600, and 1575.

DJIA futures are down 21 points.

 

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