Around the Globe

Asia – CLOSED
• Shanghai (China) +0.62%
• Hang Seng (Hong Kong) +1.75%
• Nikkei (Japan)+0.35%

Europe as of 6:43am EDT

• DAX (Germany) +0.33%
• FTSE (UK) -0.39%

Today’s Economic News:

Plenty of economic news today.  We draw your attention to the sea of green from Europe, a combination of lower than expected inflation (ie. no pressure to raise interest rates) and  better than expected sentiment numbers (albeit worse than last read).   Check out that Spanish 12-month note, short term interest rates are under pressure.  Those are some of the basic ingredients for a bull run.

Quote of the day:
Never judge a book by its movie. – J. W. Eagan

Current Allocations from our room:

Performance Month to Date from our room:

Current Breadth Readings:

For breadth today we show the Cumulative 4 week nh/nl chart which chopped over the end of last week, but now is re-established as bullish.

ES SP500 Futures Comments:

Short: 1363
Long:  1310

We are starting to fill schizophrenic with changing daily outlooks.  Yesterday pre-market we were quite bearish, but the hold and rally on an NR7 and a review of the breadth charts and TLT and the US Dollar action make it very difficult to be bearish.  The long term trenders on breadth both returned to bullish yesterday.

The US Dollar falling from the highs and TLT sitting on historic highs, the promise of QEx and world wide stimulation are all fueling us up for a nice rally.  When it will begin we are not sure.  Here or lower?   We still remain concerned over the correction last week and the depth of that correction, and need to see another Friday type (20+) breakout day to convince us that bonds are broken and the Euro remains viable.  When that happens, hold on, we will get a nice ride up.   We are not sure if we are on the ride now, there may be another dip in our future – some type of exhausted move on TLT that will surprise everyone.  That is the move that we fear right now and that might reset price one last time before departure on our final journey.

For today, we are bullish, as the indicators tell us so, with an eye on bonds and the dollar.

US Dollar DX Futures Comments:

The US Dollar is rejecting the 84 level and that makes us think bullish.  We would like to se a sustained downside.

TLT Twenty Year Bond EFT Comments:

We tapped our 130.50 target from the consolidation breakout and a double is forming here much like the US Dollar.  We are at extended levels on both of these counter-trend market indicators, that makes it very difficult to be bearish here.

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