There appears to be a significant amount of news and market movements today. For instance, gold may be trying to make a break for the upside. If it was not gold, the gold and precious metal miner stocks did show some strength in yesterday's trading, as both the Marketvectors Gold Miner ETF (ticker GDX), the Marketvectors Junior Gold Miner ETF (ticker GDXJ), and the XUA all increased by about 3% in Thursday's trading. This is while treasury bonds continue their sell-off, the UUP trading lower (albeit still in a trading range), and the more defensive sectors in the markets trading lower against the S&P 500. The market appears to be telling us that economic growth is set to resume. This is despite lackluster sales growth in the second quarter, declining earning expectations, global growth that looks set to slow, and a Euro rally that looks to failing (a signal of the risk-on/risk-off trade). This is while the more economically sensitive small-cap names (as exemplified by the IWM, IShares Russell 2000) is not confirming the rally.
Then we have this news. Reuters is reporting that the White House is considering releasing oil from the strategic oil reserve. Is this an election year ploy? Does it suggest that tensions with Iran are set to escalate? After reading this piece from soberlook.com yesterday, I find it hard to believe that a release of oil reserves will help alleviate high gas prices. U.S. crude oil stocks are elevated, but gasoline stocks are low, due in part to a lack of refining capacity. A release of oil from the strategic reserve will not help refiners push out more gasoline.
One last quick note, the rally on the SPY looks to have failed in yesterday's trading.
On a intra-day basis, the SPY attempted to push into and through the April 2nd swing point, but failed to do so twice and closed off the highs.
On a daily basis, the SPY traded 112 million shares vs. 151.7 million shares. Anemic volumes and the sell-off pushing into the highs is a sign of a failure on the rally attempt. Today's trading action will be telling if the rally will continue.
Then we have this news. Reuters is reporting that the White House is considering releasing oil from the strategic oil reserve. Is this an election year ploy? Does it suggest that tensions with Iran are set to escalate? After reading this piece from soberlook.com yesterday, I find it hard to believe that a release of oil reserves will help alleviate high gas prices. U.S. crude oil stocks are elevated, but gasoline stocks are low, due in part to a lack of refining capacity. A release of oil from the strategic reserve will not help refiners push out more gasoline.
One last quick note, the rally on the SPY looks to have failed in yesterday's trading.
On a daily basis, the SPY traded 112 million shares vs. 151.7 million shares. Anemic volumes and the sell-off pushing into the highs is a sign of a failure on the rally attempt. Today's trading action will be telling if the rally will continue.
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