August Gold is trading flat overnight. Comments regarding inflation from Fed Chairman Bernanke seemed to have stopped the rally in this market in its tracks. Yesterday Bernanke testified that the Fed has the tools to control inflation after it begins to increase interest rates. This market is trading inside of a retracement zone so it could be finding resistance. Bernanke’s comments should have triggered a sell-off but traders must be watching the Dollar for direction.
The September E-mini S&P 500 is expected to open steady to lower. The main trend is up but the current rally seems labored at current levels. Money seems to be willing to come in on the dips, but no one seems to want to chase this market at high levels. Yesterday, a rally in the bond market drew money away from equities.
Traders are beginning to assess the risk between the two asset classes and will soon have to make up their minds as to continue to pump money into stocks at current levels or go for the lower return but the safety of the Treasury market.
November Soybeans are trading slightly better overnight. This market seems to be building a support base but so far a big buyer has not stepped in front of bearish news from China and the ideal growing conditions. Technically this market is extremely oversold.
September Crude Oil is trading lower as speculators await today’s Energy Department report. Estimates are calling for U.S. crude stockpiles to drop about 2.25 million barrels. Traders expect to see gasoline inventory figures show an increase of about 850,000 barrels when the weekly Energy Department supply and demand report is released. Both markets have reached technical resistance levels which could help attract selling pressure and trigger the start of a decline.
