Editor's Note: Todd posts his vibes in real time each day on our Buzz & Banter.
The third quarter cometh and not a moment too soon; you could almost hear hair follicles hitting the trading desks last week as fund managers put the final touches on the first half of their year.
While June was a volatile month, 2013 is shaping up just fine, thank you: The Dow Jones Industrial Average
(INDEXDJX:.DJI), S&P 500
(INDEXSP:.INX), and Nasdaq
are all hovering at or near 13% which isn’t too shabby, all things considered.
We covered a lot of ground last week; on Monday we asked if Shibor Will Become the Modern Day Sub-Prime
On Tuesday, we offered that China Is Trying to Teach the USA Free-Market Capitalism
On Wednesday, after the paltry 1.8% GDP, we discussed the difference between a Stock Market Rally and an Economic Recovery
, and gave a Pop Quiz: Will the Stock Market Rally Last?
Thursday, we highlighted the technical landscape in The US Stock Market: Highway to the Danger Zone
and Friday we asked if Gold Was a Leading Indicator of Equities
before offering that Gold could see a $100 rally the before Friday (as I write, gold
has traded $68 off the low print).
We began this abbreviated holiday stretch—flush with Q3 agendas, thin skeletal ranks manning trading desks, and all sorts of technical influences
—on a positive note after Japan set the global tone (+1.3%) and Chinese equities edged higher (Shanghai lost over 20% in June alone; the bounce, thus far, is all of 7%).
All eyes turn to the United States of America to see if the country will indeed have a happy birthday.
The stateside tape opened higher, testing the 50-day moving average at S&P 1623. Thus far, S&P 1600—past resistance and near-term support—held two tests of that level.
The banks, breadth, gold, and tech should help guide us as we together find our way. Goldman Sachs Group Inc (NYSE:GS), Citigroup Inc. (NYSE:C), JPMorgan Chase & Co. (NYSE:JPM), Deutsche Bank AG (USA) (NYSE:DB) and Barclays PLC (ADR) (NYSE:BCS) remain our primary single-stock tells.
With unregulated over-the-counter derivatives tying the world together—not just still, but now more than ever—we must respect the unexpected. Risk has not disappeared; it has simply changed shape.
Stocks have rallied, as has gold (+ almost $70 since we sniffed a bounce on Friday; who was it that said to never let an opinion get in the way of making money?). Either way, the updated S&P vs. Gold chart is pasted below for your review.
Position in SPY.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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