Gold has sold off considerably in the last two weeks as the USD has strengthened against other major currencies.  Gold is now down $100 since it’s high of $1,226 as investors also take profit from the huge runnup this market had in just the passed three months alone.  Looks to be some consolidation around the $1,100 level as that is great support at that price.

The WTI spreads in the front months have been sold off with vigorous offers that it has dragged the flatprice down below $70.  The Jan/Feb spread has now weakend to -$2.60 in the front contract spread.  This has sold off significantly from the last blog I had written and will continue to do so as January goes off the board.

We are seeing a trading range of 20-30 points in which there is no real excitement on the S&P. The holiday season typically shows low volume and sell offs due to losses taken before year end for tax purposes. A recession typically mean sluggish behavior and no real upward trend. Here is my prediction! People will get their pants all up in a bunch because retail and job numbers will be more positive. Market may go up for a few days. Than everyone will realize that seasonal workers were hired and sales will decrease over the next quarter. Oh, and let’s not forget that people are putting most of these sales on credit cards they cannot pay. Day trading is not easy in this environment and we must maintain a defensive attitude.

they never move in straight lines. They overshoot in one direction and then overshoot on the way back. Best of all, just at the moment when they are most stretched in one direction…..that’s when “investors” feel the strongest desire to join the crowd.