Overall, the reports released this week showed some mixed data. Productivity is slightly higher with increased labor costs. Increased labor cost is an effect of inflation. Factory orders also came out on Tuesday with a significant decline of 4.7% versus an increase last month of 1.7%. The factory orders tend to be of little importance because it is released a week after the advanced durable goods orders giving similar information.
Mortgage applications are higher at 647.6 versus 599.0 previously.
This can likely be attributed to lower interest rates.
The FOMC meeting is Tuesday. It is widely expected that the Fed
will leave rates unchanged. According to Gartman, the Fed has
rarely changed rates during the December meeting. It is also likely
that even though it appears to be a pivotal time in the markets,
change usually takes longer than expected.
March Ten Year Note Technical Levels:
Trend Direction: Long Term Trend is Lower; Short Term Trend is higher. The March Ten Year Notes would need to rally through 110-05.0 to signify a long term trend change in the market based on the weekly TY chart. The trend is your friend. The longer the trend, the more significant the support & resistance is. Therefore, I would look to buy puts or sell the TY near the 110-05.0 area if the near term momentum carries us there. A break below 108-15.0 would indicate that the short term trend turned lower.
Resistance: 109-27; 110-02.0
Support: 108-15.0 -108-18.0
Financial Reports for the week of December 11th -
December 15th:
Monday: Wholesale Trade - 9:00 am CST
Tuesday: US Trade Balance - 7:30 am CST
FOMC Meeting - 1:15 pm CST
Wednesday: Business Inventories - 7:30 am CST
Retail Sales - 7: 30 am CST
API/EIA Energy Stocks - 9:30 am CST
Thursday: Weekly Jobless Claims - 7:30 am CST
EIA Gas Storage - 9:30 am CST
Friday: CPI - 7:30 am CST
Real Earnings - 7:30 am CST
Capacity Utilization - 8:15 am CST
Industrial Production - 8:15 am CST
