WEEKLY MARKET DIGEST: STOCK MARKET SHOWS SIGNS OF EXHAUSTION, INTEREST RATES CLIMB AND BARGAIN HUNTING IN GOLD $GLD $SLV $USO $DIA $SPY $QQQ $TBF $TBT

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

PERSONAL INCOME AND SPENDING WORSE THAN EXPECTATIONS, GOLD BUYING IN ASIA BUT SELLING IN AMERICA

 May 31, 2013

April personal income came at 0.0% vs. 0.1% consensus and personal spending came at -0.2% vs. 0.1% consensus. These numbers indicate the consumer is slowing.

Gold and silver saw heavy buying in Asia but mild selling so far in North America.

Stock market bulls are acting tired this morning.  Our stance remains select buying, select shorting and select profit taking.

Gold futures are at $1406, silver futures are at $22.25, and oil futures are $92.86.

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

DJIA futures are down 73 points.

GDP DEFLATOR AT 1.1%, GOLD BREAKS $1400 TO THE UPSIDE

May 30, 2013

This morning GDP Deflator was revised to 1.1% from 1.2% initial estimate vs. consensus of 1.2%.  GDP Deflator measures price levels of all goods and services in the economy.  This is one of the best indicators of future inflation and carries significant weight in our models.

Gold has broken over $1400.  We have been telling you  that this was probable due to the set up in options and due to the aggressive short covering.

Bulls have stepped in to buy stocks this morning, let us see if it lasts through the day.

Gold futures are at $1405, silver futures are at $22.77, and oil futures are $91.85.

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

DJIA futures are up 11 points.

STOCK MARKET SHOWS SIGNS OF EXHAUSTION, INTEREST RATES CLIMB AND BARGAIN HUNTING IN GOLD

May 29, 2013

Last week we told you about the stock market tracing an ‘outside day’.  An outside day is a reversal pattern.  Yesterday’s trading data shows classic signs of exhaustion.  Today’s trading will tell us if the bull gets a second wind or the market traces an island reversal.  An island reversal is another one of the reversal patterns in the traditional technical analysis.  If it is formed we will write more about it, we are just being vigilant.

Interest rates hit new highs on signs of U.S. economic recovery.  Yesterday the 10 year Treasury yield hit 2.23%, a level not seen since March 2012.

There is considerable evidence of mom and pop buying physical gold attracted by lower prices.  However, it is worth pointing out that historically gold does not perform well when interest rates are rising.

Our algorithms are monitoring in real time trading data from across the world in gold and silver.  If there is any change in our ratings we will let you know.

Gold futures are at $1389, silver futures are at $22.27, and oil futures are $94.23.

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

DJIA futures are down 79 points.

HOME PRICES RISE, GOLD FALLS

May 28, 2013

Case-Shiller 20 – city Index, which represents home prices, rose 10.9% vs. 10.1% consensus. In other words, home prices are rising faster than expected.

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Bulls are firmly in control of the stock market.  There is no real catalyst but bulls are pointing to rate cuts in Hungary and Israel.  In our analysis, this is simply grasping at straws.

In our view it is all technical buying because a series of Tuesdays have been positive.  Further, historically the stock market rises on the day after Memorial Day.

On Monday, aggressive buying by Japanese investors was seen in gold.  Today all is well in the world and aggressive selling of gold is being seen in North America.

Gold futures are at $1381, silver futures are at $22.29, and oil futures are $95.52.

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

DJIA futures are up 129 points.

 

 

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