Richard Suttmeier is the Chief Market Strategist at www.ValuEngine.com.

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September 17, 2010 – New all time high for gold with no Risky Levels as yet

The 10-Year US Treasury yield is still between my annual pivot at 2.813 and this week’s risky
level at 2.609. Gold is above this month’s pivot at $1263.8 after another new all time high at
$1279.3. Crude oil is below annual and weekly pivots at $77.05 and $77.69. The euro is between
its 50-day simple moving average at 1.2886 and its 200-day at 1.3233. The Dow has become
overbought and holding my semiannual pivot at 10,558 targets my weekly risky level at 10,699.
Home repossessions are on the rise while business CFOs sentiment softens.
10-Year Note – (2.761) Annual and annual value levels are 2.813 and 2.999 with a daily pivot at
2.731, and weekly, monthly, quarterly and semiannual risky levels at 2.609, 2.562, 2.495 and 2.249.

Courtesy of Thomson / Reuters

Comex Gold – ($1275.8) Semiannual, quarterly and annual value levels are $1218.7, $1140.9 and
$1115.2 with daily, weekly, semiannual and monthly pivots at $1272.7, $1252.7, $1260.8 and $1263.8.
 Courtesy of Thomson / Reuters

Nymex Crude Oil – ($74.38) My quarterly value level is $56.63 with a monthly pivot at $74.45, and
daily, annual and weekly pivots at $76.16, $77.05 and $77.69 and semiannual risky level at $83.94.

Courtesy of Thomson / Reuters

The Euro – (1.3080) Daily and weekly value levels are 1.2855 and 1.2792. Quarterly and monthly
value levels are 1.2167, 1.1721 and 1.1424 with semiannual risky level at 1.4733. Note that MOJO is
rising again on the daily chart.

Courtesy of Thomson / Reuters

Daily Dow: (10,595) Annual, monthly and quarterly value levels are 10,379, 10,164 and 7,812 with
daily and semiannual pivots at 10,539 and 10,558, and weekly and annual risky levels at 10,699 and
11,235. My annual risky level at 11,235 was tested at the April 26th high of 11,258.01. The Dow
has become overbought.

Courtesy of Thomson / Reuters

Home Repossessions are on the Rise - Lenders took possession of more homes in August than in
any month since the start of “The Great Credit Crunch.” Even though the number of properties
entering foreclosure slowed for the 7th month in a row, banks repossessed 95,365 properties in
August, up 3% sequentially and 25% year over year. These homes become Other Real Estate Owned
on the books of the banks and they represent the hidden inventory of homes that will be sold at
depressed prices to compete with homeowners who are selling existing homes at lower prices in each
of the past three months.
The reason foreclosures have slowed is that banks are delaying initiating the foreclosure process on
homeowners who have missed payments, letting borrowers in default stay in their homes longer. This
is a problem as a slowing economy is keeping unemployment stubbornly high and keeping consumer
confidence in the dumps.
The sale of existing and new homes have fallen off a cliff in the months following the expiration of the
home buyer tax credits which expired at the end of April for contracts and ends for closings at the end
of this month (extended from June). RealtyTrac estimates that 2.3 million homes have been
repossessed since “The Great Credit Crunch” began at the end of December 2007. They estimate that
more than a million households will lose their homes to foreclosure in 2010.
The Duke University / CFO Magazine Business Outlook Survey - The survey says that pessimism
about the US economy has returned to recessionary levels among CFOs, which is a clear sign of a
Double-Dip. I have opined on numerous occasions that you can’t have a double-dip until the first dip
has ended, which in my judgment has not. The NBER has not time-stamped the end of the recession
that began in December 2007. How can they with unemployment at 9.6% when the recession was
declared with an unemployment rate at 4.6%? This is common sense everyone!
This plus uncertainty with regard to health care and tax policy has many of the 937 CFOs polled by
Duke hoarding cash and stating that credit remains too tight for small businesses. Without solution to
the unknowns CFOs foresee earnings growth and capital spending declining over the next six to
twelve months.
That’s today’s Four in Four. Have a great day.
Richard Suttmeier
Chief Market Strategist
ValuEngine.com
(800) 381-5576
Send your comments and questions to Rsuttmeier@Gmail.com. For more information on our products
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