Macro Week In Review/Preview: November 2, 2012

Last week’s review of the macro market indicators suggested, heading into next week the markets continued to look vulnerable. Gold was still biased lower in the channel but possibly finding a bottom while Crude Oil looked better lower. The US Dollar Index and Treasurys seemed content to move sideways with longer term bias lower. The Shanghai Composite was done with its bounce while Emerging Markets continued to consolidate.

Volatility looked to remain low but was showing signs of life. These created a mixed environment for the Equity Index ETF’s SPY, IWM and QQQ, with the dollar and Treasurys supporting Equities while Volatility and Crude Oil pointing lower. The charts of the Indexes themselves all were biased to the downside.

The week quickly became historic with the exchanges closing for two days in a row for weather for the first time in over 120 years. The reopen with only 3 days ahead of the jobs report made for a hectic short week. Gold consolidated most of the week before breaking lower Friday while Crude Oil moved sideways and the US dollar drifted slightly higher, all three trading outside of US hours to start the week. Treasurys remained in a tightening range.

The Shanghai Composite consolidated at last weeks lows before moving higher while Emerging Markets held their range. Volatility fell back to support remaining subdued. The Equity Index ETF’s SPY, IWM and QQQ tested a move higher out of consolidation only to give some back on Friday after the nonfarm payroll report. What does this mean for the coming week?

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