Editor's note: this column was originally published on Capital Essence's CEM News on October 03, 2007. It's being republished as a bonus for the loyal readers. For more information about subscribing to CEM News, please click here.
Good Morning. This is Capital Essence's "Market Outlook" (the technical analysis of financial markets) for Friday October 05, 2007 .
As expected, equity market closed slightly higher Thursday after traded in a tight range around the unchanged mark for the entire session as the investors remain in a wait-and-see mode ahead of the September jobs report, which is scheduled to release tomorrow morning.
Gold was the brightest spot in Thursday session. The SPDR Gold Shares ETF (GLD) bucked the overall trend, added +1.35% for the day.
Apparently the precious metal is taking a breather after the stunning September's rally. Just so that you know, the yellow metal had gained more than 10% since profiled here as a potential buy candidate. General speaking, the technical outlook remains bullish as long as price holds above the 70 level.
Let's take a look at the major indices:
The Standard & Poors 500 Index (daily) chart above addresses a short-term time frame. The board market index continues to drag sideway beneath resistant at July's peak. Technically speaking, this high-level "churn" is suggestive of an approaching peak. Although as mentioned, the bears don't really have any cases until or unless they manage to push prices to below September 25's low of 1507.
The Dow Jones Industrial Average (daily) chart above addresses a short-term time frame. The blue-chip index seems to be in a bit of a holding pattern. Technically speaking, trading action in the past couple of days represents a bullish congestion pattern ahead of another upleg. Support is about 13700.
Bottom line: as noted above, stocks seem to be in a bit of a holding pattern prior to tomorrow jobs report. Although the larger picture remains unchanged – we have a strong market that is poised for a breakout to new high. Hopefully tomorrow jobs report can provide the needed catalyst to trigger an upside resolution to the current stand-off.
Until next time, good luck
(By: Michelle Mai for Capital Essence)
Note: Michelle Mai writes technical analysis for Capital Essence and is the editor of Capital Essence's "Market Outlook" newsletter. To receive the daily edition, please subscribe. It's now available at a monthly rate.
