Home > Uncategorized > Brief Update 2009/12/04: Viva la Differential Difference: Bernanke Blast Moot as Weak Fundamentals Weighed on Equities Until US Employment”

Brief Update 2009/12/04: Viva la Differential Difference: Bernanke Blast Moot as Weak Fundamentals Weighed on Equities Until US Employment”

▪ That gave some hope to govvies and US dollar. This also will help keep the Crude Oil under pressure, and has finally weighed on Gold, all on various differentials of direct and counterpoint influence. Of course, now the decision is up to response to positive US Employment report. While we’ll have more to say on “differentials” by which equities influence other markets below, it is more important right now to revisit a summary of the critical technical levels.

▪ Those key technical areas include DJIA 10,300-350 with a Tolerance into the 10,500 area, and key lower support in the 10,100-10,000 range. S&P 500 future has managed to range temporarily above the 1,102-1,108 major downside Gap from last October, yet not quite hit its Tolerance all the way up into the 1,120-25 range, and has so far held no worse than near-term support in the 1,095-90 area. That is the counterpoint consideration to the govvies which weakened in part due to supply in Europe over the last couple of days, on a ‘differential’ to the strength of equities. While the counterpoint is still there between the equities and long-dated government bonds, it is only once the equities hold up for too long that the bond markets become concerned the equities might be headed for a new high, and get nervous.

As noted on Wednesday lead futures contract (December) resistances and support are T-note 121-16/24 and 120-00/119-16, and Gilt futures at 120.00 and 120.82, with 119.00-118.70 and 118.00 below. Strong sister Bund is less troublesome due to the modest discount in the March contract leaving it no worse than 123.00-122.80 support now.

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