Well, same old, same old really. As the US and Europe ratchet up the sanctions, Putin has ordered "retaliatory measures" of an unspecified nature and has massed more troops along the Ukraine boarder:
"Political tools of economic pressure are unacceptable, they contradict all norms and rules," he said. "In that connection, the government of Russia has already proposed a series of retaliatory measures against the so-called sanctions of certain countries. I think that in current conditions, with the goal of protecting the interests of domestic producers, we could certainly think about that." he added.
Russia's Vedomosti newspaper reported Tuesday that the government was considering a partial or total ban on overflights of Siberia by European airlines, which use the route to shorten trips from Europe to Asia.
European markets are already suffering with Italy dropping 2.9% this morning on news that it has officially slipped back into a Recession with GDP falling 0.2% in Q2 – a far cry from the +0.2% predicted by leading economorons. The IMF has cut their optimistic growth estimate for Italy to 0.3% in 2014 and dropped Spain to 1.3%. Spanish markets are down 2% today as well.
We decided this was a good time to buy this morning and, at 6:58 this morning, I put up this chart for Members in our Live Chat Room, saying:
Check this out – all hitting the S1 lines so far:
It's certainly worth playing for a small bounce at 16,275 (/YM), 1,905 (/ES), 3,850 (/NQ) and, of course, 1,110 on /TF. Just looking for very quick bounces, the trend is still DOWN!
The Dollar jammed up to 81.77 and that's not sustainable (short-term) so hopefully we get a little bounce – plus we are oversold again
We even pulled our bearish oil bets (SCO) and we're taking long pokes on oil at the $97.50 line (/CL). A lot of people were panicking into the Dollar overnight and it pushed that index (/DX) up to 81.77 and that is what put a lot of pressure on the indexes and commodities, more so than finding out Italy and Spain are weak (duh!) and Putin is trying to take over the Ukraine (duh!).
As you can see from Dave Fry's Dow chart, we're getting close to that 200 dma and, in fact, we tested it pre-market (that green line at about 6:30) and that needs to hold or we're not bearish enough!
Yesterday morning, I warned you not to get suckered in by the weak bounces and now that we're down another 1%, we need to adjust those weak bounce lines a bit lower but that means it SHOULD be easier for the indexes to show us a bit of strength. If not – look out below!!!
Tags: DIA, Dow Jones Industrial Average, Hedging, Italy, MCD, Options, Putin, Sanctions, Spain, SPY, Ukraine
This entry was posted on Wednesday, August 6th, 2014 at 7:23 am and is filed under Immediately available to public, Uncategorized. You can leave a response, or trackback from your own site.
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