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CTA Trading Desk Morning Report

[7:00am ET] Good morning.

European banks are weak this morning, so I'm not looking to chase stocks higher here.

The question of the day seems to be whether or not Gold (GLD) can hang on its recent gains. My answer is (i) the Fed policy of keeping interest rates so low that in relation to inflation they will be negative, until 2015 maybe, is good reason to buy Gold, and (ii) as long as the Indian Rupee (INR) is lifting, then capital is flowing into India and the upper class there have more resources to buy Gold.

CTA Trading Desk Morning Report

[7:00am ET] Good morning.

The Euro is strong this morning as European banks and other traders believe that a deal to resolve the Greek sovereign debt crisis is imminent.

A weak US Dollar is lifting the prices of equities, commodities and precious metals. In European markets, the (i) Banks, (ii) Miners & Oilers and (iii) Consumer stocks are mostly in the green.

CTA Trading Desk Morning Report

[8:45am ET] Good morning, Geoff here.

Yesterday, we saw a few cracks in both the stock and gold markets. As you know, we have been long but cautious for a week or so. When the market “should” take a breather but doesn’t, it often pops higher as it squeezes shorts out of their positions. Today’s Fed meeting could be the catalyst for future direction so today may be rather slow until then.

Yesterday, we had a number of earnings releases.

CTA Trading Desk Morning Report

[8:45am ET] Good morning, Geoff here.

CTA Trading Desk Morning Report

[9:30am ET] Good morning, Geoff here.

If you haven’t read the Week in Review yet, I recommend that you do.

This morning, I don’t have much to add to what Bill wrote.

Our portfolios are “fully long” right now because the market hasn’t rolled over yet and our hedges were taken off last week. However, I have been writing that many stocks are overbought and continued caution is warranted in the short term. The market could use a breather, so be ready for a decline that could happen any day and should that occur, dips should be bought.