Top technician Katie Stockton of BTIG says that the market is on the cusp of a big breakout, and she has two charts that explain why.» Read More
The NASDAQ has shown impressive strength in the face negative headlines. Over the last two days, NASDAQ 100 futures have rejected the day's lows, and managed to finish with only mild losses.
The main reason for the relative strength is probably are surgence in Apple shares, as Doug Kass predicted on Thursday's episode of Futures Now. Apple accounts for some 13 percent of the NASDAQ weighting.
After a two-day meeting, the Fed is due to the release its monetary policy statement later this afternoon, as well as its economic forecasts. The news will be followed by a press briefing with Fed Chairman Ben Bernanke.
(CNBC Explains: Federal Reserve Open Market Operations)
Investors will be looking for any signs that the central bank could start winding down its quantitative easing program. It is expected to keep monetary policy unchanged this month however, continuing its super low rates policy and its $85 billion a month in asset purchases. Fed watchers expect it to stick with its program until the middle of next year, according to CNBC's Fed survey.
The outside chance that seemingly endless monetary stimulus could be on the road to withdrawal may upset bonds, yet traders expect Europe's latest troubles to limit any potential downside.
The 10-Year Treasury note has enjoyed a massive rally over the last three sessions, with yields hitting their lowest level in three weeks. Some investors are being drawn to bonds ahead of the U.S. Federal Reserve's policy decision on Wednesday.
The Fed's efforts to support an economic recovery has sent stocks on a tear, but also put a floor under bond prices. In September, it launched a third round of quantitative easing (QE), in which it will buy $40 billion of mortgage-backed securities per month, primarily in mortgage-backed bonds. Those open-ended purchases mean they will continue to flood markets with cheap liquidity indefinitely, in order to drive down unemployment.
(Read More: CNBC Explains the Federal Reserve)
The Dow Jones Industrial Average turned lower, dragged by Caterpillar. If the blue-chip index closes lower, it will log its first three-day losing streak this year.
The S&P 500 and the Nasdaq also tilted lower. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded above 13.
The S&P takes a licking and keeps on ticking.
Equities in the U.S. have all but fully recovered since we heard the news that Cyprus is looking to tax bank deposits. The S&P is currently at 1,546, nearly unchanged, as it was able to close back into the major resistance. Yesterday's recovery was able to reach the next resistance level of 1,552, as investors began to think that what may take place in Cyprus is very unlikely to spread any further.
A top or a bottom in a market is not a price – it's a process.
The metals market had a wild ride last night. Gold rallied as news hit that a tax would be levied on bank savings in Cyprus. The safe haven trade took the driver's seat, as traders and investors alike jumped into gold, leading the metal to post a high of $1,607.60 before reversing course back down to the low of $1,589.60 .
The stock market continued to grind higher on Thursday, with the Dow Jones Industrial Average higher for the 10th-consecutive session and the S&P 500 index within striking distance of its all-time closing high, as investors cheered a better-than-expected weekly jobless claims report.
(Read More: Jobless Claims Slip While Producers Paying More)
Peanut butter and jelly. Bert and Ernie. And gasoline and crude oil.
Some things just belong together.
But lately, that last pair have split up, at least in the short-term. Over the past month, crude oil has dropped while gasoline has rallied.
(Read More: Dollar Strength Blamed for Crude Oil Reversal)
Brent crude dropped below a key $109 a barrel level on Wednesday, following news of a rise in U.S. stockpiles and the release of some mildly bearish government data, but some traders blamed crude's reversal mostly on U.S. dollar's strength.
By midday, the U.S. Dollar index rose by 0.41 percent. In turn, Brent crude fell 88 cents to $108.79 a barrel, after swinging between a high of $109.80 and a low of $109.32 earlier in the session. U.S. oil rose 18 cents to $92.72, gaining for a fifth day in the longest daily winning streak since mid-December.
(Read More: Brent Falls Anew After US Inventory Jump)
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