Richard Suttmeier is the Chief Market Strategist at www.ValuEngine.com. ValuEngine is a fundamentally-based quant research firm in Newtown, PA.

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http://www.valuengine.com/pub/Unsubscribe? April 4, 2012 Markets turn as Fed suggests no near term additional easing. Markets in Review: The Nikkei 225 ended their Wednesday session at 9,820 down 2.29% on the day. European
stocks are lower this morning tacking onto Tuesdays losses. The FTSE 100 ended Tuesday at 5,838 down 0.62% on the day. The DAX ended their session at 6,982 down 1.05% on the day. The CAC 40 ended their session at 3,407 down 1.62% on the day. The yield on the 10-Year US Treasury declined from 2.202 percent to 2.150 then rose to 2.297 following the Fed minutes that suggest no near term additional easing of monetary policy. The markets fell sharply after the minutes from the Federal Reserves last meeting indicated that the central bank was considering additional economic stimulus measures, but is not ready to act yet. Gold declined to $1640.2 the Troy ounce staying below its 200-day simple moving average at $1686.9 and traded as low as $1630.7 this morning. Crude oil declined to $103.59 versus its 50-day simple moving average at $103.73 and traded as low as $103.02 this morning. The euro versus the dollar declined 1.3217 testing its 50-day simple moving average, and traded as low as 1.3163 this morning. The Dow Industrial Average declined to 13,131.21 following the Fed minutes staying below its 52-week high set at 13,297.11 on April 2nd. The NASDAQs declined from 3126.82 to 3097.41 shy of its 52-week high at 3134.17 set on March 27th. Stock futures point to a lower open this morning.

Todays Four in Four Key Levels: 1. Yields - The yield on the 10-Year US Treasury should continue rise towards my annual value level at 2.502, as long as the 200-day simple moving average at 2.173 provides resistance. 2. Commodities - Gold is below my semiannual pivot at $1635.8 this morning with the March 22nd low at $1625.0. A weekly close below $1635.8 indicates risk to my annual value level at $1575.8. Keep in mind that if the 50-day SMA at $1708 falls below the 200day at $1687.4 we have a death cross. Crude oil should remain above my quarterly value level at $101.55 as my annual and semiannual pivots at $103.58 and $104.84 remain magnets. This shows how pivots have an 85% chance of being tested. 3. Currencies The euro versus the dollar fell below its 50-day simple moving average at 1.3217 with my semiannual value level at 1.2980. 4. Equities - My quarterly value levels are 12,794 Dow Industrials, 1337.7 SPX and 2911 NASDAQ. My quarterly and annual pivots are 829.34 Q / 836.15 A on the Russell 2000 and 1363.2 A SPX. This could be the third week in a row that small caps traded above 836.15, but failed to stay above this key level. My quarterly risky level is 5420 on Dow Transports. My prediction remains that Dow Transports and Russell 2000 will continue to lag 2011 all time highs at 5627.85 set on July 7th and 868.57 set on May 2nd. VE Morning Briefing If you want expanded analysis of the US Capital Markets go to this link and sign up: http://www.valuengine.com/nl/mainnl?nl=D