2/11/15…a rally led by…Utilities???

TB’s Wine Quote of the Day: “Wine is a four-letter word – good and good for you.” – TB

Bloomberg Quote of the Day: “Experience is not what happens to you; it’s what you do with what happens to you.” – Aldous Huxley

Overnight Global Markets:

Global equity markets weak ex-Hang Seng and Korea; Japan closed: UK -0.5% vs -0.3% vs -0.8% vs -0.2% vs -0.2% vs -0.6%; France –0.5% vs +1% vs 1.3%!!! vs –0.3% vs -0.1%; Germany -0.1% vs +0.7% vs -1.8% vs –0.6% vs -0.1%; Japan closed vs -0.3% vs +0.4% vs 0.8% vs -1% vs +2% vs -1.3%; Hang Seng -0.9% vs – vs -0.6% vs -0.4% vs +0.4%; Korea +0.5% vs -0.6% vs -0.4% vs +0.1% vs -0.5%; India +0.6% vs +0.5% vs -1.7%!!! vs -0.5% vs -0.1%; U.S. equity futures also weaker: DOW -35 (range 44 +10 gap); SPX -2.70 (5) NDQ +1.50 (7 +2).

Global Money Markets: Libor: 0.256% 3 mos; 0.362%; 6 mos – still inching up!…but remain near their recent record lows! The Fed Funds rate has averaged 0.09% and remains 0.12-0.14% – 0.14% is the 9-month high! T-Bills: 0.01%, 1 mo; 0.02%, 3 mos; 0.08% 6 mos; 0.23% 1-yr – 0.25% is the 12-month high!

U.S. Treasury Bonds are feebly attempting to rally for a 3rd day: 10’s 1.98% +1/8; 30’s 2.57% +3/16; Long TIP: 0.72% +1/8.

European Bond yields mostly lower – ex-Greece!!!: Germany 0.36% -1; UK 1.67% +1; France 0.68% -2; Italy 1.67% –; Spain 1.60% –; Portugal 2.52% -2; Greece 10.25% +34 vs 9.90% -55 vs 10.47% +69 – incredible volatility!!! Recent range is: 7.03% to 10.79%!!! – cycle low: 5.42%; Crisis high: 12.57%. Japan: 0.38%! –; low is 0.19%!

Dollar Index stable at 94.78 +.02. 1/26’s 95.527 was highest since 9/30/03! Euro slightly better at: 1.1314 +.0006. 1/26’s 1.1098 – an 11-year low!!! Sterling 1.5293 +.0002; topped out at 1.5352 on 2/6, after bottoming out 1/26 at $1.4952, with critical support at $1.48, a double-bottom from 3/29-31/2013! Yen weaker again at $119.82 +0.02, broke through the 40/50 day – res is now 119, the 40/50 day m/a’s! 1/15’s 115.86 was best since 12/17/14’s 115.57 – weak since peak Oct. ‘14: 105.23; recent best 2/4/14 @ 100.76!!! Record: 12/30/11: 75.35!!!

Commodities: Gold trying once again to ‘bounce’: $1233.50 +$1.30. The 200 day ($1233) is major support. Silver slightly better at $16.90 +.03. Friday’s low was $16.54. Crude broke $50 again and is at $49.48 -.54 with resistance at $50.60!!! A lot ‘could’ happen – caveat emptor remains the watch phrase!

Tuesday’s Market Summary:

Here we go again…an ‘up’ day…but what was the leading index? Dow Utilities! UP 2.1% – more than a third better than the best challenger, NDQ 100 +1.5%! Composite was +1.3%; S&P 500 +1.1%; Dow Transports +0.9%; Dow 30 +0.8%, and Russell 2000 +0.6% – if small caps are supposed to be most reflective of economic growth, what does this say… when it is beaten by a dividend producer by more than 3:1

Here’s another thing(s): Volume barely budged to an average 3.63B shares vs 3.44B shares; A/D’s and Breadth were modestly positive; New 52 week highs rose but remain feeble, while new lows rose but remain low. The S&P VIX closed lower for the first time in three sessions but remains bearish at 17.19 -1.36 – retraced Monday’s rise.

Will continue to update the ytd scoreboard in this volatile environment: Dow 30 +0.3%; Dow Transports -2.4%; Dow Utilities +0.4%; S&P 500 +0.5%; Nasdaq Comp +07%; NDQ 100 +1.1%; Russell 2000 -0.1%. Look at Financials -2%: KBW Banks -3.9%! Nasdaq Banks -3.3%. Philly Gold/Silver +11.8%!!! ( for the Gold Bugs out there)

Total NYSE Volume barely budged despite the rally to a weak 3.63B shares vs 3.44B vs 4.24B vs 3.8B vs 4.12B vs 4.6B – ytd low is 2.7B on Jan. 2; while 12/24’s 1.4B shares is the 12-month low. Shares traded on the NYSE floor were steady (and volume at the bell is all that pushes it up every session) at 779M shares vs 776M vs 927M vs 794M vs 900M – 1.22B on 1/30 is highest since 8/8/11!!! – 646M is the ytd low while 12/24’s 349M is the 12-month low…average is 743M shares! Since 1/5 the average is 854M shares and steadily declining! The Dec. ave peaked at 979M shares on Dec. 22nd.

Advance/Declines were positive for only the 9th time in 21 sessions! NYSE: +1.3x vs -1.4x vs -1.7x vs +3.1x! vs -1.8x vs +3.8x!; Nasdaq +1.6x vs -1.7x vs -1.2x vs +2.8x vs -1.6x. Breadth was similar: NYSE +1.5x vs -1.3x vs -1.2x vs +4.2x! vs -1.9x vs +7.4x!!! vs +4.5x! Nasdaq +2.8x -1.4x vs -1.2x vs +3x! vs +1.04x vs +3.8x! New 52 Week Highs rose to a boring 148 vs 108! vs 250 vs 242 vs 215 vs 290 – their range for the last 12 mos. is 39-612!!! New Lows inched up again to a still weak 78 vs 54 vs 44 vs 56 vs 58 vs 55 vs 162 vs 275 – 2015 high is 386 (12/16’s high was 712!!!) The 12-month range is 24-1043!!! S&P VIX reversed Monday’s rise, closing at 17.19 -1.36 – range: 16.97-18.36. The recent high is 12/16’s 25.20, second only to 10/17’s (31.06!) – highest since 11/2/11!!! Average of the past 12 months is 14.59 and slowly climbing, with a low of 10.28!…high close was 26.25 on 10/15/14!

U.S. Bond Market was weaker for a 4th straight session after setting new low yields on Greece: 10’s 2.00%! -3/16 (1.64% low yield); 30’s 2.58% -1/2 (2.22% new low!); Long TIP 0.72% -7/8 (0.49% new low!).

Gold plunged for the 2nd time in three sessions closing at $1232.20 -$8.60 AND with a negative ‘key reversal’ – due to Monday’s narrow range. Friday’s low was $1228 before bouncing but still ended with a $28.10 loss!!! It was also the lowest close since 1/12/15. It had been morose for a week since the biggest daily gain to the high since 2012 ($28.10) on 1/30. It peaked at $1307.80 on 1/22. Friday’s close was $19 BELOW the 200 day. 11/7’s low, $1130.40 is the current 12-month low! 7/17’s session high was $1346.60, highest since March 19th!!! RESISTANCE is the 200 day, $1253, and now the 40 day $1233, with feeble support at the 50 day at $1228. The 12-month high is $1392.60 on 3/17/14, highest high since 9/4/13. Silver resumed its slide closing at $16.87 -.20. The 200 day ($18.38) is resistance with support at the 40 day, $16.81, and the 50 day, $16.79. $14.12 is the recent low (12/1/14), first time in more than five years!

Crude closed weak barely holding on to $50 after plunging to $49.86. It closed at $50.02 -$2.84! 1/28’s low was $44.08, lowest since 3/09. $50-52 is now resistance/support. 12/17’s high was $58.98. Consider: 10/25/14’s high was $84.83. There have been 64!!! handles since peaking at $107.73 on June 13th, highest since 9/19/13, and if is off 59% since then! The record high of $147.27 was on 9/30/08. RES again at the 40 day ($50.60!!!), then the 50 day ($53.47), and lastly the 200 day ($84.30). The range is $43.58-$112.24 since 3/1/12. Note that following the financial crisis it traded down to $32.40 on 12/31/08 from a high of $147.27 just three months earlier (-78%!!!). Recall TB’s prediction of a bounce at $43.83? WILL it test that $32.40 March ’09 low?…by the way, the decline from the 9/20/08 high to the low took EXACTLY 6 months – we are now in the 8th month of decline!!!

Have a great day!

TB

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