Monday, October 29, 2012

Anomaly of two sweeping events

As a home town fan of the Giants, their World Series victory is undermined. Based on Google Trends, the top trends are Hurricane Sandy, WWE, and Bob Ross? I congratulate the Giants though for overcoming two series deficits and sweeping the team with a triple crown winner.

Hurricane Sandy will convert from a Category 1 to a tropical storm in less than 24 hours. Winds will decrease by 50% by Tuesday night. As unfortunate as this anomaly is, it is overblown by media. Cuba had the worst affects of this hurricane.

U.S. stock markets are closed, and will most likely open on Wednesday. Personal income and personal spending has increased based on last month's survey. The DXY has broken the $80 resistance level, while SPX is on the brink of falling through the $1400 support level. Futures have indicated that DJI has already broken through it's $13000 support line, which may be a bad sign. 

On Wednesday, I see a drop in volatility which should set stage for a strong bounce in the indices. Stocks will be in a flat channel, as eyes are on Friday's unemployment rate report. This value is not only important for stocks, but the presidential election. If the number declines more than half a percent, expect the incumbent to be re-elected.

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