Obama Sends Markets Mixed Signals

Asian markets had a mixed and volatile trading session as they slowed on gains. This comes after U.S. President Barack Obama delivered a speech and asked Congress to defer its vote on Syria.

During a speech to the American public, overnight, Obama said he would work with allies to convince them to join forces to force Syria to hand over its chemical weapon arsenal. This is the only way for Syria to avoid a U.S. military striker. After the speech, crude oil prices moved down. Oils is now only 15 cents from a one week low at $106.53. Crude is currently, at the time of this report trading near $106.90 per barrel.

STOCKS
The Nikkei 225 is now at a new seven week high as it is trading above the key 14,500 level. This is the benchmark’s highest level since June 25. The yen helped boost the Nikkei as it traded to a seven week high against the Dollar. The yen, at one point was trading at $100.53.

The Shanghai Composite is now at a three month high, but stocks on the Hong Kong were down 0.3 percent and the Kospi, in South Korea was flat. The Australian S&P/ASX 200 is closing in on a five and a half year high and is at 5,225.50. We are 40 points away from that peak.

U.S. markets closed near its session highs overnight. The S&P 500 has now seen six straight days of gains. This comes after good data out of China and as fears over a Syrian strike recede.

The DJIA rose 127.94 points to close at 15,191.06. The index has now see its first two day rally that involves triple digit gains since June of this year. The S&P 500 was up 12.28 points to end at 1,683.99. The NASDAQ Composite jumped 22.84 points to close at 3,729.02. Both the S&P and NASDAQ are on six day long win streaks.

CURRENCIES
Currencies other, other than the yen, have been surprising as they have been on the rebound. Today, the yen rebounded.

USD/JPY (100.55) is now above 100.00. We are bullish and can now test 102.00 and higher. Please see the below chart.

The AUD/USD (0.9292) is still moving up on short covering. We could rise past 0.9400 soon. The EUR/USD (1.3254) has moved higher over the last several days at a nice steady pace. The euro is moving higher with European equities. We could range trade a bit at these levels from 1.3100 to 1.3410.

COMMODITIES
Commodity world is down a Syria is getting ready to surrender its vast inventory of chemical weapons.

Gold (1363.30) is just above a support level near 1351.00. If that level breaks, the doors open for 1300.00. Copper (3.267) is moving higher on upbeat economic data out of China. A medium term view shows us consolidating between 3.20 and 3.31 for now. The metal is now above 3.25 and looks to test 3.27 next, which should hold and bring a correction to 3.20.

TODAY’S OUTLOOK
Markets will be digesting Obama’s speech from last night, so we could continue seeing a mixed day. However, as threat to war abates, this will only push commodities like Oil lower, as the threat on supply lessens.

The U.S. will release Mortgage applications today, wholesale trade and its oil inventories later in the day.