SP 500 and NDX Futures Daily Charts

Thin volume 'risk on' rally as stocks faded into the close from the highs but kept some gains.

The markets are primarily eyeing the sovereign debt situation and discounting domestic results and economy, at least for now.

SP Dec Futures Intraday - Operation Twist Begins

Although this could break out and keep going, I have held the thought that this is just a short squeeze within the context of a broad trading range from 1100 to 1220. It should be noted that the futures tend to be a little 'sloppy.' These moves up and down in a broad channel are what is known as a 'wash and rinse' or 'wax on, wax off.'

There is a potential triple top at 1215.

If the futures can break and hold 1230 then we might see a more sustained bull market leg, but I have trouble seeing that until the European debt situation is resolved.

However it is possible. And since the Fed begins its bond purchases to implement 'Operation Twist' this week we may see some new liquidity providing an impetus for stocks, and some perception management activity as well.

Be careful of the short side until the trend breaks.

Gold Daily and Silver Weekly Charts

Gold was strong overnight but was stepped on quite hard about 9 AM London time as is often the case. The east buys and the west sells.

Nothing has broken out yet. So we wait a bit and bide our time.

I am running some moderate gold bullion and a light silver addition on the ability to hold 32. A small hedge short broad stocks goes with it. No miners yet in the portfolio.

SP 500 and NDX Futures Daily Charts - US 3Q Earnings Season Begins Today

The US kicks off third quarter earnings season after the bell as Alcoa reports.

The markets remain thinly traded and headline driven.