Good Morning Traders!
Welcome to Fourth Quarter. Third quarter was marked by the strong trend in the dollar and downward trend in commodities like metals and grains. The divergence between the big cap and small cap stocks continued to widen, while rates stayed contained in a broad trading range.
Wednesday brings three bar triangles in the SPs, Dow, Dax, and the Bonds. 1955.50 is the low of this formation. 1979.25 is the high. It is pointless to try and predict in advance how the market will behave out of these formations, but more often then not there are greater expectations of trend off the opening price.
The Dollar index (as well as the EC) had a wide range day (WR7) which often can be signs of a short term buying climax. Both the weekly and the Monthly charts of the Dollar index made new momentum highs and there is no topping formation, but the market can test back below the 5 SMA. The YEN has daily Buy divergences that are forming, though this too will most likely lead to a trading range consolidation pattern.
Cows have a pinball BUY as does Cocoa.
Have an excellent trading day to start the last quarter of 2014!