Wall Street closed in green territory Tuesday after better-than-forecast earnings from Dow component Johnson & Johnson and ahead of reports from blue-chip technology giants Intel Corp. The Dow Jones Industrial Average ended up 65.16 points to 12,266.75. It was a partial recovery from the prior session, during which the average lost 140 points after Standard & Poor’s lowered its outlook on long-term U.S. sovereign credit. The Nasdaq Composite Index gained 9.59 points to 2,744.97 while the S&P 500 Index rose 7.48 points, to 1,312.62.
Crude futures settled higher Tuesday, overcoming a wobbly start as the dollar weakened and prices bounced off early lows. Benchmark light, sweet crude advanced $1.03, to $108.15 a barrel on the New York Mercantile Exchange though it had earlier traded as low as $105.50 a barrel. A weaker dollar also provided support for prices.Traders also were watching reports that Nigeria’s Muslim north has rebelled against the apparent electoral victory of incumbent president Goodluck Jonathan. The riots have left several people dead, according to news reports Tuesday. No damage to oil installations has been reported.
Gold prices held steady below $1,500 and silver hit a 31-year high on Wednesday, supported by a weak dollar and concerns over a sovereign debt crisis in the euro zone. After U.S. gold futures breached $1,500 in the previous session, spot gold is expected to rise beyond the key psychological level, but choppy trade is seen going forward. A weakened dollar lent support to precious metals. The dollar index a measure of the greenback against a basket of currencies, softened towards its 16-month low hit last week, after the euro and commodity currencies rebounded from a sell-off earlier in the week.
Today’s Important Economic Announcements (GMT)
7:00 AM EUR German PPI m/m
9:30 AM GBP MPC Meeting Minutes
3:00 PM USD Existing Home Sales
3:00 PM Crude oil Crude Oil Inventories
Silver
Silver continued to charge ahead, rising to a 31-year high for the fifth consecutive session, as investors continued to favour gold’s less expensive cousin. Spot silver rose to $44.30, a level unseen since 1980, before easing slightly to $44.25, up 0.8 percent. Medium-term trend following indicators continued to highlight a bull trend, but warned that silver might go through a correction in the near term before resuming the uptrend, as the metal has been very overbought. The Relative Strength Index on spot silver rose to above 84, a level unseen since February 2008, indicating a heavily overbought market. For the next 24 hours, we encourage our trader to sell silver.
Stop Loss: 44.5
Take Profit: 42.7
Crude Oil
U.S. crude futures edged up in early Asian trade on Wednesday as a weaker dollar and firmer equities buoyed prices on top of a smaller than expected rise in last week’s U.S. crude inventory. U.S. crude inventories rose last week less than forecast while oil product stocks fell, data from the American Petroleum Institute (API) showed on Tuesday, despite a rebound in U.S. refinery utilization. Oil prices are likely to stay high and adding more crude to the market would not cool them, Iran said on Tuesday, striking a typically bullish stance a day after other OPEC members said costly fuel could slow global growth. Traders would be wise to short sell crude oil with a relatively close take-profit.
Stop Loss: 110
Take Profit: 106
USD/CAD
The Canadian Dollar moved more than a cent and a half off the high Monday (0.9720) to currently trading below 0.9550 on Tuesday. So far today the pair has been supported above 0.9540. A break below opens the door to the initial target and recent low of 0.9525. Trader’s will need their head on a swivel if we break below 0.9500 which is the next logical support point, even though technical support does not exist until much lower. We are likely to hover around 0.9500 for foreseeable future.
Stop Loss: 0.9624
Take Profit: 09500
Published by www.SolidityBrokers.com
