Wednesday, July 09, 2014

Good Morning, America, How Are You?

I have decided that today will be a wonderful day.  I may have to face trials that will challenge that outlook, but I can choose to have a wonderful day. 

I was thinking this morning, that Christianity is the most difficult human philosophy to live by in the whole world.  It is almost impossible for me to turn the other cheek, to love my enemies, and to treat my neighbor as I would be treated.  That made me think of Communism.  Karl Marx believed religion (and he was thinking only Christianity) had to be eliminated in Communist environment.  However, that leaves a huge hole that Communists fail to take into account.  How do you willingly help your neighbor?  How do you forgive those who wrongfully use you?

Governments who think they can force one set of people to be good to other sets of people are wrong minded I believe. 

Small Business Outlook

Summary: 

·         Trading yesterday followed my scenario pretty well. The market open down, and tried to make a push in the first 5 minutes to close the gap.  However, the market failed to care through and did not come close to last Thursday's close.  The market went into a chop starting around 9:00 AM.  Dear Reader, we are in a bull market, and the prices are nowhere near any important trend lines or pushing below any significant resistance points. 

·         The major averages registered 2 down days.  This does not indicate the bull is over, or even there is any major correction.  What it tells you to do, is that if you a medium term trader, you should be taking out insurance on stocks you own. 

·         The bond market was stronger yesterday.  The bench market 10-yr note yield fell five basis points to 2.56%. 

·         The situation in Israel is causing concern, and stocks in Asia were in a turmoil.  Yet the US futures markets are up this morning.  Iraq's situation is not improving. The Ukraine situation has take a seat way in the back of the bus.  

·         The Asian turmoil was caused by China, which printed another contraction in consumer prices.  Producer Prices had another negative print.  This was the 28th negative report in a row.  Hang Seng Index tanked. 

·         Look for the USD/JPY to surge.  If that happens, then forget about the weak Asian session, as the US equities will surge. 

·         Today, the stock market is flat to open, and front month futures contracts show very small ranges since 5:00 AM this morning.  The market will remain choppy until the FOMC minutes are released at 11:00 AM PDT (2:00 PM EDT).  Several analysts are expecting that the FOMC minutes will show a much more hawkish tone, than the tone Janet Yellen has been using.  Day traders should be very cautious, and try to get in on the trend when the minutes are announced.