Home > Uncategorized > Weekly Overview: 2010/01/19: Equities Earnings Trump Weak Housing & Consumer Sentiments, But For How Long?

Weekly Overview: 2010/01/19: Equities Earnings Trump Weak Housing & Consumer Sentiments, But For How Long?

▪  March NASDAQ 100 future recovering into the 1,890-93 key topping action from last week left all markets a bit critical into Wednesday morning prior to the selloff; and recent lows are fairly important levels as well. The ultimate test will come based on whether it also holds on no worse than the 1,850 area tested last week. The other critical indication which works very well with that is whether weak sister DJIA 10,600 area UP Break maintains, or it capitulates below its Tolerance at the 10,423 selloff low hit on the last trading day of last year. 

▪  And as equities are a key driver of trends in other asset classes, that will be important for whether government bonds and the US dollar maintain their current resurgence, as well as whether February Gold holds onto its key 1,125-17 support for a push higher. Obviously, the difference is that the influence into the bond market is generally in the form of counterpoint, and the Gold will be more directly influenced by the equities trend.

▪  Whatever transpires, as long as US Dollar Index holds no worse than its .7700-.6650 UP Break and Tolerance, it is still likely headed for more substantial .7958-.8000 interim resistance or possibly even higher levels. With the euro as the downside leader, it will be very important to see not only whether EUR/USD slips below its 1.4217 December trading low, yet rather whether it breaks the confluence of other supports (including the major up channel from the March 2009 low) in the 1.4180-50 range. 

▪ March T-note has pushed up from 116-20 into its more significant 117-16/-24 area. Above there it could see 118-16 or even 119-00 once again.

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