Good morning Traders,DOW Snapshot from the previous trading...

Good morning Traders,

DOW Snapshot from the previous trading session:

"After a tumultuous day, U.S. stocks ended mixed Tuesday, as investors mulled over reports on auto sales, factory orders and the Federal Reserve's December meeting. Throughout the day, investors weighed a better-than-expected factory orders report with concerns that stocks may be overextended, after posting double-digit percentage gains in 2010.

"We've had such a run here in the last four weeks, without any downside relief," said Rich Ilczyszyn, a market strategist with futures-broker Lind Waldock. "It's a normal market reaction, as we go up for a month or so and then we pull back."

Stocks ended 2010 with their best December since 1991, and some traders think they may have gotten a bit ahead of themselves. As a result, stocks were held back Tuesday as some investors tried to reap the rewards of their 2010 bets now -- in case the market falls back in January. Traders also mulled over the minutes from the Federal Reserve's latest meeting in December, which showed that the central bank's policymakers remain committed to the purchase of $600 billion in U.S. Treasurys as a means of stimulating the economy.

Anticipation of that stimulus policy, referred to as "quantitative easing" or "QE2," had fueled bullish stock market gains in the second half of 2010. Investors had grown concerned about whether the Fed will follow through with the full $600 billion program in 2011. The minutes alleviated some of those fears. "Takeaway number one is they're not going to stop QE2 right now," said Doug Roberts, chief investment strategist at Channel Capital Research. "And it looks like from this, they're not as hesitant about QE3 as one might think." "[Source: cnnmoney.com]

Market Reflections - Tuesday, 4th January, 2011

"Tuesday's economic news was definitely upbeat including surprisingly strong factory-order data, solid chain-store reports, and FOMC minutes that show confidence in the economic outlook. But the markets aren't ready to move much ahead of Friday's employment report. The Dow rose only slightly to end at 11,691 while interest rates were little changed. Profit-taking in thin markets made for over-sized 2-1/2 percent drops in both gold, at $1,380, and oil, at $89.27. The drops raised talk of quick rebounds but also talk of deeper profit-taking then followed by more significant rebounds. Traders said strength in the dollar, up four tenths on the dollar index to 79.44, was not a significant factor in the gold and oil dip." [Source: bloomberg.com]

Also of note: Stock Outlook for 2011: Recovery Rally Will Continue!

The DJIA Index finished the last trading session Up 20.43 points; and
The SPI Futures are currently: Up 3 points atm.

Of note in the US this evening:

ADP Employment Report [Merits extra attention]

ISM Non-Mfg Index [Merits extra attention]

EIA Petroleum Status Report [Merits extra attention]

...AND...

Of note in Australia today:

HIA New Home Sales (MoM) (Nov) [Moderate volatility expected]
[HIA New Home Sales released by the Housing Industry Association presents the number of new home sales in Australia. It indicates the housing market condition. House buyers spend money on furnishing and financing their homes, which stimulates the demand for goods, services, and the employees. Thus, a high reading is seen as bullish (or positive) for the AUD, whereas a low reading is seen as bearish (or negative).]

AiG Performance of Services Index (Dec) [Moderate volatility expected]
[AiG Performance of Services Index released by the Australian Industry Group presents business conditions in the Australian service sector. The group surveys 200 manufacturers on their assessment of the business situation including employment, production, orders, prices, and inventories, and their short-term planning. A result above 50 is seen as positive (or bullish) for the AUD, whereas a result below 50 is seen as negative (or bearish).]

[Sources used: bloomberg.com; dailyfx.com; fxstreet.com; nasdaq.com]

Gold is currently trading Down $33.30 & is sitting at US$1,381.30/oz atm [Source: Kitco]
Oil is currently trading Down $2.17 & is sitting at US$89.38/bbl atm [Source: Bloomberg]
The Dollar: The AUD is currently trading @ $1.0054 against the US Dollar[Source: Forex. Live]

Have a great day trading today all.

Cheers, Tweets

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