Home > Uncategorized > Brief Update: 2010/01/05: Equities Remain the Prime Mover for Other Asset Class Decisions

Brief Update: 2010/01/05: Equities Remain the Prime Mover for Other Asset Class Decisions

▪ And that is in spite of some current trend divergence from the normal nominal intermarket price action in markets as diverse as the long dated government bonds, energy and precious metals. What is most interesting this week is the March S&P 500 future push above the important 1,125 area, which places the burden of proof on the bears to get the genie back into the bottle by Friday’s Close. Otherwise, higher resistances in the 1,180-1,200 or higher area are likely to be seen. Mr. Bernanke apparently impressed the bond markets with his commitment to using the blunt instrument of base rates to quell future irrational exuberance if regulatory reform fails to get the job done. Yet, when that opportunity presented itself to him back in late 2006, he singularly failed to pull the punch bowl… 

The equities’ decision will likely have much to say about whether March T-note holds its major 115-00/114-16 support,…  and whether US Dollar Index trading back below .7770 is merely slippage toward its recent .7700 UP Break, or prelude to failing .7650 Tolerance

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