Home > Uncategorized > ROHR: Brief Update 2009/11/27: AMBUSH!! A ‘Dubai-ous’ Influence Triggers a Return to Uncertainty

ROHR: Brief Update 2009/11/27: AMBUSH!! A ‘Dubai-ous’ Influence Triggers a Return to Uncertainty

▪  Oil exporter default is a shock insofar as it raises concerns about credit markets once again. This moves something that the markets had generally thought was a settled issue back into the realm of “known unknown” (thank you Mr. Rumsfeld.) And the extent of shock is proportional to this potential problem being an “unknown unknown” to most of the world (other than those directly involved with Dubai financing issues) until  yesterday’s announcements.  The equity markets response has been consistent with the old adage that it “dislikes nothing quite so much as uncertainty”, which has suddenly significantly resurfaced where confident assumptions of further economic and equity market strength had stood previous. 

That said, in light of current events, it seems less perverse that recent upbeat economic data assisted bonds more than equities, and the US dollar is resurgent while December Gold futures slip back from major 1180-1200 area resistance with Crude Oil weak as well.  Insofar as equities remain the key, DJIA stalling at no better than the 10,500 Tolerance of major 10,300-350 resistance is still only back to the top of more critical 10,100-10,000 support, and December S&P 500 future stalling into its 1,102-08 major downside Gap from last October held in overnight  electronic trading right into the 1,070-65 support we had specified previous. December T-note above the 119-16/120-00 area wasted no time pushing up to 121-16/122-00 next resistance, while the US Dollar Index has recovered nicely after temporary slippage below the .7450-30 area Tolerance of its .7500 area support. Risk appetite is definitely waning.

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