Tuesday, March 31, 2009

Morning Update/Market Thread 3/31

Good Morning,

Futures are up about 8 points on the S&P this morning, with the 793 level on the /ES offering resistance so far. The short term stochastic is oversold, so I am expecting higher to sideways action until those indications are worked off. Here’s a snapshot of the overnight action:

The NDX is going to open above yesterday’s hammer body. That is very bullish and thus you may get a gap fill or partial gap fill on the NDX today.

Today is the end of month/quarter, so whatever "window dressing" was done during the past week may be undone beginning tomorrow. Also, the G20 meeting is getting close and that will probably have some market impact. Japan announced yet more "stimulus" with Yen that they don't have. Their debt problems are worse than our own, but that doesn't seem to stop countries from just pouring in the currency - as if that has ever helped. It hasn't helped Japan, and it won't help us.

ICSC store sales picked up last week, rising 1.1% for the week, but lower than the same week last year. The Redbook (chain store sales) picked up a little for the week also, but was down year over year as well.

The S&P Case-Schiller data for the housing sector fell for the month of January…
(EconoDay) Case-Shiller data for January shows steepening rates of price contraction, at -2.5 percent for the composite 10 index and -2.8 percent for the composite 20. Year-on-year rates of decline also deepened, at -19.4 percent for the 10 index and -19.0 percent for the 20 index. Developments in the housing sector are being watched on a month-to-month basis given new efforts to limit foreclosures and the ongoing drop in mortgage rates. But this data does confirm that home-price contraction was deepening at the outset of the year. More recent data on new and existing home sales shows no let up in the contraction during February.

Will be busy again today, appreciate the participation and observations to help one another trade this very difficult and certainly not free market!

Have a good day,