Pieces of the market puzzle

OK. Let’s put some things together :

S&P 500 is in a channel, close to it’s 50d MA. No direction yet, but if there is one, it can be quite strong. What to look at ?

  • Oil (USO) had a strong pullback and will test it’s 50MA. Drop because of the stronger dollar. Would Kopenhagen have something to with it? Maybe, but then it’s only temporary, because of the momentum. Effect on oil consumption because of a more green world is not on short term.
  • Dollar (UUP) : The $ rises for several reasons (better data, euro weakness, raise of interest rates because economy improves)
  • Gold (GLD) : on it’s way back, also because of the dollar. But will it continue ? It is still a safe haven for central banks
  • Volatility (VIX) : high swings, a high swing up can be expected in the coming months. But with what effect on the stocks ?

So, currently it is a mixed view, that’s why the S&P is in a channel. We see good signs, bad signs. Is the US improving, but not ‘yet’ the rest of the world ? What about China (+), Dubai (-), Greece(-) ?

The clear direction of the last 6 months is gone, the Christmas Turkey is in the oven, check on it from time to time. I currently own UUP and DZZ, with tight stops.

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