The metals and stocks were hit hard today in advance of a weak Philly Fed number and higher than expected unemployment claims. Both results are directly attributable to Hurricane Sandy, in the manner of a no-brainer. One of the more densely populated regions of the US was brought to a virtual standstill for almost two weeks along with $40+ billion dollars of storm damage.
I suspect the selling is winding down as those who have profits take them this year to avoid higher taxes next year. I think it is overdone now. So far this has been fairly 'cool-headed' selling in stocks and shown by the VIX.
The smackdown in the metals today had all the appearances of a well-calculated bear raid timed with a dump in stocks off a predictably weak economic number. This is also known as 'a trading idea.'
I think the coil in the metals is winding tighter and tighter.
For those who can remember trading back then, this is the type of market when Rubin and Greenspan would provide some 'surprise' to turn the market around into a rally. Don't remind me of what it was like trading the short side of the futures back then. One had to be nimble.
Have a pleasant evening. Remember those in the northeastern US who are still suffering from cold and homelessness. It is a very tough situation. Warren Pollock has been reporting from his home in Long Beach, NY. He compares his own area to 'the Dominican Republic' and the area south of Merrick Road, nearer to the ocean, as 'Haiti.'
