A very strong session in America with the SP500 up +1.24%. Dow...

A very strong session in America with the SP500 up +1.24%. Dow 30 +1.22%. Nasdaq100 +1.24%. Russell2000 lagged a little, but not much +0.94%. Volume was light – but that often happens at the start of a trend. We need to see some short covering now to boost this along.

Tomorrow is the Jobs Report – it would take a very poor report to knock this momentum. Wednesday and Thursday both had preliminary jobs data and the market has responded positively. So the odds of a poor report tomorrow are low.

The market will be tested once it hits the big congestion zone marked on the chart.

The 20-Day MA has crossed below the 50-Day MA – that’s often considered bearish, but in a strong bull market it often comes at the end of a correction. Nothing’s easy in the market. What works in one set of circumstances doesn’t work in another set.

20-Yr Bonds:

Bonds trend inversely, more or less, to stocks in a deflationary environment. TLT dropped again last night. It’s now back to the support of the 20-Day MA and the 200-Day MA. That could hold. But the false break of four days ago suggests this has more downside. Good for stocks.

US$ Gold:

US$ Gold continues to flop around like a freshly caught mullet. Until it can break out of its down trend channel, I won’t get excited about Gold. (I can’t get too excited about mullet, either. Now, barra is a different story.) While stocks are looking strong and we have relatively weak seasonal factors, I doubt that we’ll see much upward movement in Gold. Miners may be different – they could be dragged up by the general market sentiment. Just don’t expect a lot.

I mentioned in the most recent Weekly Report that the media was beating up Doom, Gloom and Dire Events for the Emerging Markets comple - but I thought it was just fear mongering. Reason – EMs had already had a big fall and were approaching major support levels. On Monday, the EEM hit the first of those major supports. Tuesday it rebounded strongly. Last night, up +2.09%.

Other news pertinent for Australia: BHP on the NYSE +2.06%. EWA (ETF for Ozzie stocks on the NYSE) +2.52%. Ozzie Dollar +0.53%. Copper ETF +2.1%. US Oil ETF +0.55%. Steel ETF +2.79%. Coal ETF +2.07%.

Redbacka