Alcoa good results, Oil down, BUT market conundrum ??
5 minutes Emini Nasdaq 100 Candlestick
Daily Emini Nasdaq 100 Candlestick
Hi,
I wonder where the market's going.... lots of events unfolding here,,, with oil down to $53.30 a barrel and Alcoa posting good numbers.... The market should be bullish... however,, there isn't much reaction to the news... and we are in a potentially capricious territory as price nears the previous high at 1850... this is a strong resistance region....
The market condition today is best described as ranging... I although there is a surge in price in the morning session, I didn't like what stochastics and MACD were telling me... too much noise... no clear picture... there wasn't enough signal for me to take the plunge in... The afternoon session is ranging ( see boxed )....
If you look at the daily chart, MACD is crossing the signal line upwards.. this is bullish... BUT, if you look at the 5 minutes chart, you will see long-term MACD trying to cut the signal line downwards,,, suggesting bearishness.... Market conundrum.. its best to stay out until market digests all the information... and a clearer picture unfolds...
Fundamentals from Briefing.com
Market Not Accentuating the Positive:
The market reaction to news is a bit worrisome.
The decline in oil prices has been spectacular. Yet, it is providing little support to the broad market. There is no doubt that it will bring profits down in the energy sector, but lower oil prices are unquestionably good for the overall economy. The lack of response to the move is noteworthy. Oil is down $0.70 this morning to $53.30 a barrel.
The reaction to good news on earnings reports is somewhat better. Genentech produced a fine report yesterday, and the stock has traded higher pre-market. Alcoa posted good numbers on Tuesday after the close and was up yesterday. It is still very early, but our sense is that these reports have stirred little optimism about the upcoming reports overall. The focus is more towards the potential negative of guidance for 2007.
The news today includes a surprise hike in UK interest rates. That won't have any impact on the Fed's decisions on rates, but it serves as a reminder that central bankers are as a breed inclined to fire first and ask questions later when it comes to fighting inflation.
The UK move was partly based on tight resource utilization. This morning, new claims for unemployment for the week ended January 5 fell to 299,000 from 325,000 the week before. The data is often distorted in a holiday week, but this serves as a reminder that the Fed remains concerned about the potential inflationary impact of tight labor market conditions.