(The Weekly Digest reproduces the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers. )
THE EFFECT OF CATASTROPHE WARNING IS SHORT-LIVED
October 4, 2013
Yesterday the U. S. Treasury warned of catastrophe if the debt ceiling is not raised by October 17th. The stock market which has been ignoring the crisis in Washington finally listened and fell in the morning. The bulls were back in the afternoon recovering about one-third of the loss. Bulls are back again in the pre-market trading.
The bulls continue to believe that the crisis will be resolved before any significant damage is done.
There is a potential for an upside spike because many investors sold short predicting a government shut down. Such investors have been proven right but the market has not fallen. Now these investors are subject to a short squeeze to the upside.
Gold futures are at $1317, silver futures are at $21.77, and oil futures are $103.97.
S&P 500 resistance levels are 1700, 1710, and 1725; support levels are 1650, 1635, and 1625.
DJIA futures are up 27 points.
WASHINGTON STANDOFF CONTINUES, EMPLOYMENT PICTURE GETS BETTER
October 3, 2013
There are no signs of progress in the Washington standoff.
Weekly Initial Jobless Claims came at 308K vs. 315K consensus; the employment picture is getting better.
So far the stock market is not taking the shut down seriously.
Gold futures are at $1308, silver futures are at $21.59, and oil futures are $103.94.
S&P 500 resistance levels are 1700, 1710, and 1725; support levels are 1650, 1635, and 1625.
DJIA futures are down 5 points.
WEAK ADP DATA, SHUT DOWN CONTINUES
October 2, 2013
The U. S. government shut down continues. Yesterday the U. S. stock market went up but today fear is creeping in that the impasse may not be short-lived.
ADP reported that the private payrolls rose by 166K vs 180K consensus. August data was revised to 159K from the originally reported 176K.
Gold is moving up on weak ADP data.
Interest rates are falling on ADP.
Gold futures are at $1302, silver futures are at $21.40, and oil futures are $102.10.
S&P 500 resistance levels are 1700, 1710, and 1725; support levels are 1650, 1635, and 1625.
DJIA futures are down 81 points.
GOVERNMENT SHUTS DOWN, STOCKS GO UP AND GOLD FALLS
October 1, 2013
Midnight deadline passed and there was no agreement in Washington. Non-essential parts of the U. S. government are now shut down.
Stocks are up and gold has fallen below $1300 as of this writing. This illustrates how markets are perverse and it is dangerous to invest based on mere opinions not backed by solid models. In theory, because of uncertainty, gold should have gone up and stocks should have fallen.
Oil is falling under $102.
interest rates are slightly higher.
Gold futures are at $1296, silver futures are at $20.92, and oil futures are $101.70.
S&P 500 resistance levels are 1700, 1710, and 1725; support levels are 1650, 1635, and 1625.
DJIA futures are up 17 points.
GOVERNMENT SHUT DOWN LOOMS
September 30, 2013
Unless an agreement is reached on a continuing resolution (CR) by midnight, non-essential parts of the U. S. government will shut down. CR is simply an authority to spend money. Many experts think that a last-minute solution may be reached. Other experts think that if there is a shut down, it will last less than 48 hours.
In our analysis, there is no way to know for sure. However it is important to be very mindful that the U. S. runs out of money on October 17, and more a contentious debate on the debt ceiling is ahead.
Any big dip in the market will be a buying opportunity as well as an opportunity to cover existing shorts.
Gold futures are at $1326, silver futures are at $21.58, and oil futures are $101.27.
S&P 500 resistance levels are 1700, 1710, and 1725; support levels are 1650, 1635, and 1625.
DJIA futures are down 141 points.
