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'QE Hype' and 'QE Fatigue' Tug of War Continues

Analysis of the Yield on the 10-Year Treasury Note (1.672): The key level to watch is my new monthly pivot at 1.681%. Trading around this pivot keeps a trading range in-tact between my semiannual value level at 1.853% and my annual risky level at 1.389%.

Analysis of Comex Gold ($1,792.7): The weekly chart for gold remains positive and extremely overbought with the five-week modified moving average at $1,713.2. My semiannual, monthly and annual value levels are $1,702.5, $1,643.3, $1,606.0 and $1,575.8 with new quarterly risky levels at $1,844.9 and $1,881.4. The Materials Select Sector SPDR Fund (XLB) ($37.02) has a neutral weekly chart profile with declining momentum if today's close is above its five-week modified moving average at $36.68. Weak industries in the basic materials sector such as mining -- nonferrous, chemical -- diversified, agriculture products, fertilizers and steel producers are offsetting strength in gold.

Analysis of Nymex Crude Oil ($91.61): The weekly chart for crude oil stays negative on a close today below the five-week modified moving average at $93.77, but my new monthly pivot at $91.34 was a stabilizing force this week. The 200-week simple moving average is a major support at $81.74 with annual and quarterly risky levels at $103.58 and $107.31. The Energy Select Sector SPDR Fund (XLE) ($73.755) has a positive but overbought weekly chart profile with the five-week modified moving average at $72.97 as oils-energy stocks outperform crude oil.

Analysis of the euro vs. the dollar (1.3015): The weekly chart stays positive today with a close above the five-week modified moving average at 1.2728. My monthly value level is 1.2589 with my semiannual pivot at 1.2917 and a quarterly pivot at 1.3048, which was tested at this week's high.

Analysis of the Dow Industrial Average (13,575): The weekly chart remains positive but overbought with the five-week modified moving average at 13,299. My annual value level lags at 12,312 with my monthly pivot at 13,506 and my annual risky level at 14,032. The Sept. 14 QE3 high is 13,653.24. The Industrial Select Sector SPDR Fund (XLI) ($37.04) has a neutral weekly chart profile with declining momentum if today's close is above its five-week modified moving average at $36.75. The industrial stocks in the Dow Industrial Average are lagging.

Analysis of the Dow Transportation Average (5013): The weekly chart for the Dow transports stays negative on a close today below its five-week modified moving average at 5038. My monthly value level is 4859 with the Sept. 14 QE3 high at 5231.15. Earnings warnings in the transportation sector pushed this average to a post QE 3 low at 4870.74 on Sept. 28, down 6.9%. This was the first warning of QE fatigue. Transports are down 0.1% year to date with industrials up 11.1%.

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SYM TRADE IT LAST %CHG
XLI $55.68 -1.30%
XLE $81.73 -1.10%
XLB $50.52 -1.20%
AA $13.84 -1.20%
GOOG $531.81 -1.70%

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DOW 17,928.20 -142.20 -0.79%
S&P 500 2,089.46 -25.03 -1.18%
NASDAQ 4,939.3270 -77.6020 -1.55%

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