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Watch the 50-day Simple Moving Averages

|Includes: DIA, DUG, GLD, iShares 20+ Year Treasury Bond ETF (TLT)
The yield on the 10-Year has risen to between my annual pivots at 2.999 and 2.813. If QE2 was working as intended this yield would be between my quarterly and semiannual risky levels at 2.265 and 2.249. Gold tested its 50-day simple moving average at $1330.0 and a close below would be the first since August 12th and would indicate risk to my quarterly value level at $1306.4. Crude oil moved below my semiannual pivot at $83.94. An important warning for commodities and equities is the euro, which is now below its 50-day simple moving average at 1.3640. This indicates risk is to my quarterly value level at 1.3318. The Dow has been above its 50-day simple moving average since September 10th and that important support is 10,967. The Congressional Oversight Panel sees foreclosure risk for the “too big to fail” banks. The NAHB Housing Market Index remains weak.
 
10-Year Note – (2.845) My annual value level is 2.999 with my annual pivot at 2.813, and daily, weekly, monthly, quarterly and semiannual risky levels at 2.767, 2.441, 2.380, 2.265 and 2.249. As I have been saying QE2 was factored into the yield curve before the November 3rd FOMC meeting.
 
Courtesy of Thomson / Reuters
 
Comex Gold – ($1341.0) Quarterly, semiannual and annual value levels are $1306.4, $1260.8, $1218.7 and $1115.2 with a daily pivot at $1366.7, and monthly and weekly risky levels at $1373.0 and $1424.1. When a market goes parabolic daily downside volatility can be painful.
 
Courtesy of Thomson / Reuters
 
Nymex Crude Oil ($82.08) Monthly and annual value levels are $78.51 and $77.05 with my semiannual pivot at $83.94, and daily, weekly, semiannual and annual risky levels at $84.14, $91.33, $96.53 and $97.29.  
 
 
Courtesy of Thomson / Reuters
 
The Euro – (1.3490) Quarterly, daily and monthly value levels are 1.3318, 1.3211 and 1.2709 with weekly and semiannual risky levels at 1.4618 and 1.4733.
 
Courtesy of Thomson / Reuters
 
Daily Dow: (11,024) Monthly, semiannual, annual and quarterly value levels are 10,848, 10,558, 10,379 and 8,523 with a daily pivot at 11,072, and annual, semiannual, and weekly risky levels at 11,235, 11,296, and 11,579.
 
Courtesy of Thomson / Reuters
 
The Congressional Oversight Panel Warns on Foreclosure Crisis - The Congressional Oversight Panel warns that the flawed foreclosure process threatens the “too big to fail” banks with billions of in losses, which will deepen the housing depression. At issue at several major banks is that thousands of foreclosure documents were signed without even being read, and in some cases the documents were backdated. Financial firms such as Bank of America and JP Morgan Chase service a total of $6.4 trillion in mortgages according to the latest COP report. Related problems are under scrutiny of our banking regulators and attorneys general in all fifty states.
 
The COP is concerned that some borrowers may question whether or not they are sending their monthly payments to the right party, that judges may block foreclosures and, that buyers and sellers could be left in mortgage / foreclosure limbo. The banks are likely to learn that they still own millions of bad mortgage loans worth billions.
 
Builder Confidence Rose a Notch to 16 in November - The National Association of Home Builders (NAHB) touts an increase to 16 from a revised lower 15 in October as encouraging, when a reading of 50 is considered neutral camouflages the fact that home builder confidence continues to be depressed. Builders remain concerned about the lack of available financing for new-home construction at a time when inventories of completed new homes are low, when there’s a glimmer of hope on the demand side. With the foreclosure market adversely affecting the market for existing homes, this is an opportunity being missed by the homebuilders as banks are stingy on both credit for construction loans and for extending mortgages while rates are low.

 
 
That’s today’s Four in Four. Have a great day.
 
Richard Suttmeier
Chief Market Strategist
ValuEngine.com
(800) 381-5576
 
Send your comments and questions to Rsuttmeier@Gmail.com. For more information on our products and services visit www.ValuEngine.com
 
As Chief Market Strategist at ValuEngine Inc, my research is published regularly on the website www.ValuEngine.com. I have daily, weekly, monthly, and quarterly newsletters available that track a variety of equity and other data parameters as well as my most up-to-date analysis of world markets. My newest products include a weekly ETF newsletter as well as the ValuTrader Model Portfolio newsletter. You can go HERE to review sample issues and find out more about my research.
 
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