daytrade diaries... november 24

Morning traders.

Market wrap: Stocks are poised to advance today after substantial overnight gains for overseas equities and commodities.

U.S. share indexes pushed back towards 13-month highs overnight and Europe enjoyed its best session in six weeks. Wall Street was cheered by strong housing data and market-supportive comments from a Federal Reserve official. The Dow bounced back from a three-day losing streak with a gain of 1.29%. The broader S&P 500 rallied 1.36% and the Nasdaq 1.4%.

The US dollar wilted and commodity prices surged after St Louis Fed President James Bullard said the U.S. should continue to buy mortgage-backed securities beyond the first quarter of 2010, when asset purchases are due to end. His comments were interpreted as a strong signal that interest rates will stay low and the government will continue to stimulate growth by pumping liquidity into the marketplace.

The market was also boosted by news that home resales jumped 10.1% in October, trumping economists' expectations. The seasonally adjusted annual rate of 6.1 million was the highest since February 2007.

The rally in the U.S. was broad but on low volume. Among the sectors advancing were: airlines +2.15%, banks +2.11%, tech stocks +1.65%, oilers +1.58%, gold/silver miners +1.45%, telecoms +1.42% and insurers +1.33%.

European markets wiped out four days of losses as traders sold the sliding U.S. dollar to invest in equities. Britain’s FTSE gained 1.98%, Germany’s DAX 2.44% and France’s CAC 2.25%.

Gold notched a new record high as war games in Iran underlined the metal's appeal as a safe haven. The spot price broke $1,170 an ounce and was recently trading at $1,164.50. Crude oil futures flirted with $80 a barrel in U.S. morning trade but have since fallen all the way back to $77.69, a modest gain of 9 cents.

Copper hit a 14-month high as investors continued to ignore rising stockpiles and bet against the floundering U.S. dollar. In London, copper gained 2.28%, lead 1.66%, nickel 1.36%, tin 1.72% and zinc 0.67%.

Futures traders expect a healthy start to the local trading day. The SPI futures index closed 33 points higher at 4762.

TRADING THEMES TODAY

BREAKOUT TRADES: Strong futures mean there should be breakout opportunities at today's market open. One way to capture these moves is by setting price alerts at critical resistance levels. Then you need a quick trigger finger. These types of moves are more reliable among the small caps, where institutional players are less likely to be operating.

GOLD: November 24th and gold has had just one losing session all month. It's a freight train at present.

ECONOMIC NEWS: The Conference Boards' leading index of economic indicators is released just as our market opens at 10 am. It's a very busy night in the US ahead of Thursday's Thanksgiving holiday: GDP, consumer confidence, regional manufacturing, house price index and minutes from the last Fed meeting. Should be a very interesting night.

Good luck to all.