There was much strength in the market on Monday, particularly in the NYSE. You can see on the chart how the NYSE's last bar is green. This indicates that both the moving average is moving higher and the current bar is greater than the previous bar. While the RUT and NAZ had larger bars, they were not strong enough to effect their moving averages to positive but did manage to move them from Friday's bearish mode to neutral today.
Overnight the markets were weak in Asia. China was down about .8% and Japan did a little better than that but still closed red. In Germany, the ZEW sentiment survey was released. This is a survey of German analyst ("smart money") and their feeling on the future strength of the economy. The raw ZEW report is actually interesting. The number for Germany was within expectations but the analyst view for the all of Europe shows increasing weakness over last month's survey. The French CPI numbers came in lower than expected and this weakened the Euro at 2:45 am this morning adding to the tumble of the futures.
We have a slew of our own data out this morning:
We would expect the PPI to be a little "hot" because of oil which has since pulled back . A higher than expected number should be forgiven as far as the markets go, but it could drive the dollar to further strength. Assuming there are no large outliers in today's numbers and based on yesterdays strength we should see either a follow through day today or a NR7 consolidation day.
But we would have to continue to break the bonds that tie the market to the dollar. Today's price action will tell us a lot about this market. If data falls in line I am interested in buy this weakness in here.
Happy Trading today.
Hope to see you in the trading room
