August 27, 2008
Markets were rather stagnant held up by a descent durable goods report. Oil is increasing and is likely to see more of the same in the days ahead, until Hurricane Gustav finally decides what it will do out there in the Gulf. There are a few reports already stating that the off-shore oil rigs are evacuating. This is necessary, since the hurricane is extremely unpredictable in the ultimate path that it takes, and those working off-shore can’t just drive home – they have to be airlifted or put on a boat. As a result, the price of oil will see an impact regardless if Gustav hits Louisiana, Texas or the Florida Panhandle.
Technically speaking, volume is horrible, and it is extremely difficult to determine which direction this market will ultimately take as the lack of volume shows there to be very little conviction by both the bulls and bears. That said, the Nasdaq remained inside of its narrow downward channel, bouncing off of the upper-band, and the S&P managed to bounce off of support levels.
Here’s the Nasdaq and S&P charts…