Todd Market Forecast
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Posted 04 August 2011 - 04:17 PM
Todd Market Forecast for Wednesday August 3, 2011
Available Mon- Friday after 6:00 P.M. Eastern, 3:00 Pacific.
DOW + 30 on 250 net advances
NASDAQ COMP + 24 on 150 net advances
SHORT TERM TREND Bullish
INTERMEDIATE TERM TREND Bullish
At the risk of being whipsawed, I’m going back to a short term bullish posture for the following reasons.
We had a high volume reversal today and frequently that type of action leads multiple days or even weeks on the upside.
We have some concern about the economic release on Thursday and Friday with the release of jobless claims and the non farm payrolls.
But, the market may have discounted all but the worst news from this quarter.
High volume frequently occurs at market inflection points, particularly at bottoms. We can see this in chart below of the S&P Spider ETF symbol SPY. Note that volume readings above 350 million shares (thick line) tends to mark solid trading bottoms.
GOLD: Gold had another solid session on the upside. Continued turmoil in Europe is part of the reason. The chart pattern continues to look quite positive.
BONDS: Bonds had another up session, but they may be struggling with an overbought condition.
THE REST: The dollar was lower. Silver was higher, but copper and crude oil were lower.
Our intermediate term systems are on a buy signal.
System 2 traders are in cash. Stay there on Wednesday.
System 7 traders are long the SPY at 132.75. Stay with it on Thursday.
NEWS AND FUNDAMENTALS:
The ADP employment report showed an increase of 114,000, above the consensus 86,000. The ISM non manufacturing survey came in at 52.7, less than the expected 53.00. Factory orders dropped 0.8% less than the anticipated drop of 1.0%. Oil inventories rose 1.0 million barrels. Last week they rose 2.3 million. On Thursday we get jobless claims.
We’re on a buy for bonds as of July 29.
We’re on a sell for the dollar and a buy for the euro as of July 21.
We’re on a buy for gold as of July 5.
We’re on a buy for silver as of June 6.
We are on a sell for crude oil as of May 5.
We’re on a buy for copper as of July 1.
We are long term bullish for all major world markets, including those of the U.S., Britain, Canada, Germany, France and Japan.
A SHORT BIOGRAPHY
Editor and publisher of the Todd Market Forecast, a monthly stock market newsletter with an included nightly hotline.
Steve has published articles on the stock market in the following publications: Barron’s, Stock Market Magazine, Futures Magazine, The National Educator, and others.
His stock market commentary is heard on the following stations: CNBC, Bloomberg, Associated Press Radio, Business Radio Network, CKNW in Vancouver, British Columbia, KFWB, Los Angeles and ROBTV in Toronto, Ontario.
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