Good morning. Good old Santa, nice to put in an appearance after the dip to 6400 and I am still pretty confident that we will get the 6800 year end. I also think that the start of 2014 will continue this bullish run. On the S&P I am thinking that it could reach 1967 in Q1 before any major bearishness. Its going to be low volume stuff all this week as most traders are off still, so will probably continue to drift about. Today’s pivot is 6733 so we will probably get another dip and rise day again today with likely support around that level.
Asia Overnight from Bloomberg
Asian stocks climbed, with Japan’s Nikkei 225 Stock Average poised for its biggest annual gain since 1972, as the yen touched a five-year low versus the dollar. The Thai baht dropped, while natural gas rose
The MSCI Asia Pacific Index added 0.3 percent by 1:52 p.m. in Tokyo, gaining for a 10th day, as the Nikkei 225 rose 0.4 percent. Standard & Poor’s 500 Index futures and FTSE 100 Index contracts were little changed. The yen sank as low as 105.41 per dollar, while the baht dropped to the weakest since June 2010 amid speculation Thailand’s army may stage a coup. Natural gas futures jumped 1.6 percent, while silver and corn declined.
The Bank of Japan is pressing ahead with stimulus in contrast to the Federal Reserve’s plan to scale back asset purchases starting next month, weakening the yen and sending the Nikkei 225 above 16,000 this month for the first time since 2007. Companies in the S&P 500 are worth $3.7 trillion more today than they were 12 months ago amid signs the world’s largest economy is strengthening. Returns on U.S. stocks are beating government debt by the most on record this year.
“Market conditions won’t deteriorate much with the U.S. economy being positive,” Hitoshi Asaoka, a Tokyo-based senior strategist at Mizuho Trust & Banking Co., a unit of Japan’s third-largest bank by market value, said by phone.
U.S. Stocks
The S&P 500 closed down less than 0.1 percent Dec. 27, after advancing 1.3 percent in a second week of gains. Treasury 10-year yields were little changed at 3 percent today after touching 3.02 percent on Dec. 27, the highest since July 2011. The S&P climbed 29 percent in 2013 in its best year since 1997, beating government debt by 32 percentage points, the widest spread since at least 1978, according to data compiled by Bank of America Merrill Lynch and Bloomberg.
FTSE Outlook
Looking at the S&P initially, if 1842 can be exceeded then 1844 and 1848 look viable targets for today.
Keeping it pretty simple today and movement above 6757 should reach the 6803 level being the top of the 10 day Bianca channel. After that the next target is 6934 which I don’t think we will see this week! I doubt that it will suddenly get all bearish this week unless something major and unforeseen happens, however the bottom of the 10 day Bianca channel has support at 6686 as well. We are still nudging the top of the 20 day Bianca channel, being 6761 which is why I think it will be a slow drift up today rather than a rapid climb to 6800. Still a case of buy the dips at support levels though, whilst this bull run continues.