Equity markets had started out the week on a positive note with the Hang Seng (HongKong33 CFD) breaking through 20,000 and the Nikkei (Japan225 CFD) breaking through 10,000. As the trading day has progressed, however, equities have been running out of steam as indices approach key levels without enough positive news to propel them through.
Although the technology sector received a boost from positive earnings out of Corning (NYSE: GLW, Stock Forum), the NASDAQ 100 (NDAQ100 CFD) hasn’t been able to overcome resistance at 1,600. The S&P 500 (SPX500 CFD) has continued to encounter resistance in the 980-1,000 range after a very positive new home sales report (384K vs. street 352K) was offset by a weaker than expected Dallas Fed Manufacturing report (-25.5% vs. street -11.0%). The Dow Industrials (US30 CFD) has been trading lower in the wake of soft results out of Honeywell (NYSE: HON, Stock Forum) and Verizon (NYSE: VZ, Stock Forum), but has continued to hold above the key 9,000 level which suggests continued consolidation rather than renewed bearishness.
Canadian markets have been holding steady today near key resistance levels with the S&P/TMX 60 (Toronto60 CFD) trading near 650 and the S&P/TMX Composite trading just below 10,750.
Commodities update: lumber and metals climb on housing data
Overall, commodities appear have been advancing today on anticipation of increased demand for resources coming out of more positive U.S. housing data, with some additional support coming for USD denominated commodities from a retreat in the greenback today.
Lumber has been climbing on the housing data, advancing toward $200/thousand board feet with next resistance on trend near $206 then $216.
Metals have continued to climb today with copper continuing to climb above the $2.50/lb level with next resistance in the $2.62-$2.65/lb area. Gold also has been advancing above $950/oz with next resistance near $965 then $980/oz. Silver had moved up in the morning but now appears to be running into some resistance near $14.00/oz.
Grains have also been climbing today although they essentially remain range bound between $3.00-$3.25/bushel for corn, $5.00-$5.50/bushel for wheat and $10.00-$10.40/bushel for soybeans.
Energy has weakened a bit as the day has progressed. U.S. crude advanced early in the day but has retreated a bit after encountering resistance at the $69.00-$70.00 range. Initial support for oil appears near $67.50/bbl, then $66.50 and $65.00. Natural gas at this point, still appears mired in the 43.50-$3.80/mmbtu range.
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Disclaimer
This commentary is based upon technical analysis. Technical analysis is the study of price and volume and the interpretation of trading patterns associated with such studies in an attempt to project future price movements. Technical analysis does not consider any of the fundamentals of an underlying company, and as such is inherently uncertain and should not be the only factor considered by an investor in making an investment decision.
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