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U.S. Equity Traders Await Intel Earnings

James Hyerczyk from ForexHound.com at 10/13/09


U.S. equity markets are trading sideways-to-lower at the midsession. This market has been leaning to the downside throughout the day and has not shown any discernible strength. Traders seem tentative to take a long position ahead of Intel’s earnings report which is due after the close.

December Treasury Bonds are trading better. Oversold conditions seem to be the driving force behind the rally although weakening equity markets could be a contributing factor. Last week the Treasury markets broke following bearish comments from Fed Chairman Bernanke. This week, traders have been supporting the Treasuries which could be a sign that traders realize his threat of a tight monetary policy is a long-term factor.

The U.S. Dollar is trading weaker against most major currencies, but there are developing signs that the Dollar could mount a strong recovery into the close. The December Euro made a new high for the year, but has since fallen back below the breakout level. The December British Pound is shrugging off bearish inflation news and is now in a position to post a daily closing price reversal bottom. Look for the December Japanese Yen to weaken if equity markets break into the close.

December Gold posted a new all-time high this morning and is holding on to gains because of the Dollar’s weakness. Given the possibility of a stronger Dollar into the close, don’t be surprised if profit-taking begins to dominate this market.

The weaker Dollar is helping to support crude oil prices today. Some of the buying is spillover support following last week’s report calling for greater global demand as the world’s economy recovers. Gains are being limited by weaker equity prices.

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