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Commodity and Stock Prices

April 6, 2011 – 6:21 pm

Gold and oil are still rising, more based on continued weakness in the dollar than anything else. However there is still fear about the Middle East and the nuclear disaster in Japan which adds to the problem. As these situations drag on the resulting pressure on prices will continue. On the other hand it appears that the rise in oil and gold s are beginning to slow.

The offsetting factor for higher commodity prices is earnings. The earnings reports will start to pick up next week. The estimate for the overall market is for a gain of about 13 to 14% for the quarter. At the same time the market is not overpriced. This growth is less than it was in previous quarters as the comparisons from a year ago are going to get tougher. If the earnings come in stronger than expected stock prices are going to rise. If oil starts to fall stock prices are going to rise and to a lesser extent if the Japanese crisis wanes and rebuilding picks up in Japan the stock market is going to rise.

There will never be a time where the stock market rests. It is a never ending process of movement. Try not to get in the way of market direction.

Good Trading
Steve Peasley

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