Friday Market Comments

This post was emailed to Myra P. Saefong, Financial Writer for Marketwatch.com, at 7:48 AM EST.


Friday Market Comments

The jobs report is certainly hanging over the markets as the overnight action was choppy and directionless. The Dollar maintains its upward bias against the Yen and the EURO but pre-report volatility has dried up. The Precious metals markets were surprisingly calm in overnight trading. Although I still think we have a 50/50 chance of a break down to the 100-day MA at 451.50, which also corresponds with the June/August highs, DEC GOLD has managed to work off all of its overbought condition in a few short sessions where the daily range never exceeded $10. This could be a signal that the big commodity funds are adding to their positions, not liquidating, and are in this market for the long haul. If that's the case, the selling will dry up quickly and we could see the next advance sooner than later.

Silver is much stronger from a technical perspective as the market didn't even touch the 50-day MA before turning higher. So, until the market closes below that level, which is at 7.433, this market remains positive.

With the exception of a few days in the middle of October, Copper has been a little like waiting for the sun to rise in the east every morning. It's almost been that reliable. The trend in this market is UP, UP, and AWAY!

Dale F. Doelling
Chief Market Technician
Trends In Commodities

In a follow up after the NFP report I wrote at 8:49 AM EST:

If the Dollar's response to the jobs report isn't enough to convince you of its overall strength, then nothing will. An extremely weak Employment report this morning brought the markets out of their slumber but the net effect has been a wash so far. The EURO has managed to tick up somewhat as bond prices firmed. The Precious metals may be the biggest winners so far as DEC GOLD is now trading at its best levels of the day above 465.00. Traders will be watching closely to see if this rally can hold. If momentum starts to wane, it could turn into a quick reversal leaving traders with no choice but to reverse their long positions and begin to square positions as we head into the weekend.
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As we now know, the DOLLAR rallied sharply leaving those long metals running for the exits.

Have a great weekend.