FuturesCom Bi-Weekly Investment Outlook # 465 Saturday January 10, 2015. SP500 and Equity Indices • Bonds • Currency Trading • Forex • Precious Metals • Energy • Grains • Livestock • Coffee • Sugar • Cocoa • Cotton. Free Two Week Trial see https://futurescom.com/free-trial-2
Saturday January 10, 2015
3:00 AM, South Florida Beach Time
Traders should continue to stay nimble and stay tuned for flashes and updates for all markets.
U.S Stock Indices opened the year with some volatility and there is still a zero interest rate environment. Seasonally the Nasdaq tends to dip into the end of January. There is a lot of noise and babble coming from a lot of corners and that is likely to continue for the foreseeable future. The yearly work remains positive. The major support is well below prevailing stock market levels. Geopolitical tensions will likely increase over the next month. The Dow Jones Industrial Average, S&P 500, NASDAQ, NASDAQ 100, Russell 2000 and the Dow Transports are all slightly down on the year. Digressing here for a little bit the amount of ‘boon’ to the U.S consumer that economists are extrapolating from cheap energy prices would only be realized over a year or longer if energy stays flat to down. I only wish that the same enthusiasm that policymakers and wall-street are having for lower energy costs this time was seen on the other side of the coin when energy prices were high. Wage growth in the latest jobs report was lousy and wage growth needs to improve. Initially the impact on earnings of corporations is a negative, long run it’s a positive for everyone.
Forex Markets; the Euro long term downside targets remain below the current trading ranges and levels. The Euro is near the 11690 to 11640 level and there lies the nearby support. Traders should Sell Swiss Franc Futures (Buy USD/CHF) and Euro and be short, look to sell a mid- month rally in a bear market. That said , traders should not expect help from the U.S Federal Reserve with rate moves anytime soon. While many economists and banks are making ‘new updates’ and estimates for when the Fed will finally have the ‘lift-off’, so far no cigar. Those efforts have been futile and the time frames keep getting updated and pushed farther out (it’s becoming comical). By some measures global debt, (this includes corporate and government debt) is 20% above the levels seen in 2007. Interest rates are at or near zero when that environment changes, it changes… Cable downside support is now 14960 to 14840, below that a test of the 14590 to 14530 region is likely. Resistance is above the market at 15690 to 15760. Middle of the road selling should occur near 15290 to 15350. The FTSE 100 work has rolled over on the medium to long term time frame, we mentioned this a month or two ago and nothing has changed. Germany’s DAX is back and forth and is showing volatility. Francis CAC 40 is in danger of rolling back over to the downside. The USD/CAD (Canadian Dollar Futures targets are lower) longer term targets remain higher however it can stall here at 11920 to 12030… Dollar-Yen is trading lower on the year. Look for USD/JPY to move back to a higher on the year level into the end of January. On the downside support is at 11805 and the 11690 to 11640 region. The nearby target on top is now 12320 to 12380 with higher tests down the road. Nearby Resistance is at 11920 to 12030. In this writers opinion Japanese policy makers are running out of time and fast. Demographically, 2 % inflation is not doing to do the trick. The Japanese Nikkei 225 is down on the year. Dollar Yen typically rises into the end of the year. Traders should consider Yen a trading affair. Look to get long USD/JPY during a dip (Sell Yen futures on a rally). The Aussie and Kiwi longer term downside targets remain lower. Both the Kiwi and Aussie dollar are trading both sides of year end closes. Sell Rallies.
Please note; Analysis for overseas equity and foreign exchange markets are available upon request. For more detailed information or a country by county economic analysis for trading or hedging programs please call or email a request.
Precious Metals and Energy; Gold and Silver remain weak longer term, nothing has changed.
Gold remains range bound and the best time to own gold for trading purposes is around now thru February and it is a trading affair at best. Copper remains weak and is below the lows of the past several years. Copper does tend to firm up a bit until early February, traders should take note of that. Silver is trading affair. The metals have room on the downside and upside and the trends are down. WTI Crude Oil, Brent Crude and the products all accelerated to the downside. Heating Oil, Unleaded Gas and Natural Gas have years of price on top of the market and remain weak. Weather is looking favorable for increased use for energy however, Natural Gas has left the region on top and is now probing long term prices not seen for a while and accelerating and Heating Oil typically moves lower into the end of January. Sell a rally for a trade. Unleaded gas tends to hold now. If Unleaded dips to 1.0140 traders should look to see if it holds for a buy, but that is a distance away. However if that is where heating oil is going we will likely short it. Grains are trading affairs and the USDA report on Monday January 12th will likely come with wide ranges and plenty of volatility. Generally traders should look to sell a rally in Soybeans in January advance of some possible weakness into February, then see how things develop at that point. Typically buying Soybeans in mid-February is a trade to consider.
Wheat has set back, record world Wheat supplies are likely just over the horizon and now demand is waning for U.S Wheat. Sell a mid-month rally. Corn was acting better, now it’s not. Farmer selling should increase and many producers are happy to see Corn at 4.00 to 4.25. Demand was poor in this week’s export data. Exports to China may improve if they increase their imports of US genetically modified corn. Livestock is trading weak, live cattle futures fell hard on Thursday and Friday. Higher beef prices and the tight cattle supply can be supportive on declines. However long liquidation and now a lower on the year level along with some expected seasonal selling that lasts from now until late January can cause a lot of price movement. Consider the livestock markets a trading affair, and stay tuned for livestock flashes and updates. Hogs are a mess and a trading affair. Sell rallies in April Hogs. July hogs typically firm up from late January until mid-march and June may hold this region also. Buying June Hogs and or July Hogs and Selling April Hogs tends to work for trading purposes.
Traders should buy June and Sell July on the open Monday. Stay tuned for livestock flashes.
Coffee rallied on drought worries in Brazil. Secondary southern hemisphere coffee producing countries are trying to ramp up production. Sugar bounced is still near contract lows. Soft global demand and weak energy are likely to continue to pressure sugar. Cotton continues to bounce around. Long term nothing has changed. Cocoa is up on the year. The 4th Quarter Cocoa grinding report will be released on January 15. On to the Nitty Gritty.
THE SENSATIONAL STOCK AND BOND MARKET
DOW JONES INDUSTRIAL AVERAGE
Support is near 17,740.00 and 17,380.00 to 17,310.00. Below that buyers should appear near the 16,960.00 to 16,890.00 region and contain a decline.
Resistance is at 18,080.00 to 18,220.00. Beyond that sellers should appear near the 18,580.00 to 18,650.00 region and cap a rally.
DOW JONES TRANSPORTS
Support should appear near 8777.00 to 8762.00 and the 8683.00 to 8668.00 region. Below that buyers should appear near 8589.00 to 8560.00 and contain a decline.
Resistance is at 8934.00 to 8964.00 and the 9044.00 to 9060.00 region. Beyond that sellers should appear near the 9,316.00 to 9,347.00 region and cap a rally.
MARCH E-MINI SP500
Nearby Resistance is at 2042.00 and 2061.50, a close over is friendly. Beyond that sellers should appear near 2080.00 to 2089.00 and the 2126.00 to 2134.00 region, and cap a rally
Support should appear near 2034.00, an extended trade below or close under is negative and augurs for a test of 2015.00 and likely the 1996.00 to 1982.00 region. Under that buyers should appear near the 1953.00 to 1946.00 and contain a decline. Traders with ice water running their veins can buy at 1953.50 and risk 10 points.
NASDAQ COMPOSITE
Resistance should appear at 4775.00 to 4785.00 and the 4845.00 to 4856.00 region. Beyond that sellers should appear near 4915.00 to 4926.00 and the 4973.00 to 4995.00 region and cap a rally.
Support should appear near 4650.00 to 4639.00. Below that buyers should appear near the 4582.00 to 4571.00 region. Failure there augurs for a test of 4514.00 to 4503.00 which should contain a decline.
MARCH E-MINI NASDAQ 100
Support should appear near 4183.00 to 4163.00, a close under is negative and augurs for a test of 4120.00 to 4110.00 and eventually the 4056.00 to 4046.00 region.
Resistance is at 4238 to 4249 and the 4304 to 4315 region. Beyond that sellers should appear near 4370.00 to 4381.00 and the 4425.00 to 4446.00 region and cap a rally. Pick your poison.
MARCH E-MINI RUSSELL 2000
Resistance should appear near 1192.00 to 1203.00. Beyond that sellers should appear near 1232.00 to 1238.00 and the 12687.00 to 1274.00 region.
Support should appear near 1169.00 to 1164.00, below that a test of 1150.00 is likely. A close under is negative and augurs for a test of 1136.00 to 1130.00
MARCH 30 YR BONDS
Resistance should appear near 148- 22 and 149- 07. Beyond at sellers should appear at 150-07
and cap a rally.
Support should appear near 146-21 and 145-22. Below that a test of 145-07 is likely. Under that buyers should appear 144-22 and contain a decline.
MARCH 10 YR NOTE
Resistance should appear near 129-21 and 130-07. Beyond that sellers should appear near 130-21 and 131-06 and cap a rally.
Support should appear near 127-22 and 126-17. Below that a test of 125-07 is likely.
THE FRENZIED FOREX FRONT
MARCH DOLLAR INDEX
Resistance should appear near the 9316 to 9347 region. A close over or extended trade above is friendly augurs for a test of 9429 to 9445 and eventually the 9706 and 9737 region, down the road.
Support should appear near 9156 to 9140 and 9060 to 9044. Where buyers should step in and contain a decline.
MARCH JAPANESE YEN
Resistance should appear near 8484 to 8499 and the 8560 to 8589 region. Beyond that sellers should appear near 8668 to 8683 and cap a rally.
Support should appear near 8391, a close under or trade under is negative and augurs for a test of 8314 to 8300 and the 8223 to 8194 region.
MARCH EURO CURRENCY
Support should appear near the 11690 to 11640 region, failure there is negative and indicates an eventual test of the 11360 to 11300 region.
Resistance should appear near 11920 to 120030 and the 12320 to 12380 region.
Stay tuned for Flashes
MARCH SWISS FRANC
Resistance should appear near 9921 to 9937 and the 10021 to 10037 region.
Traders can sell at 10017 and hold for lower prices. Risk a close over 10051 for three days in a row.
Support should appear near 9837 to 9821, below that a test of 9737 to 9706 is likely, an extended trade under or close under is negative. Trade Accordingly
MARCH BRITISH POUND
Support should appear near the 14960 to 14840 region. Below that a test of 14590 to 1 4530 is likely.
Resistance should appear near 15290 to 15350 and 15690 to 15760. Traders can sell at 15517 and hold for lower prices.
MARCH CANADIAN DOLLAR
Resistance should appear near 8484 to 8499 and the 8560 to 8589 region. Beyond that sellers should appear near 8668 to 8683.
Support should appear near 8406 to 8391, below that a test of 8314 8300 is likely, and should hold.
MARCH AUSSIE DOLLAR
Support should appear near 8044 to 8029 and the 7954 to 7939 region. Below that a test of 7777 to 7763 is likely.
Resistance should appear near 8194 to 8223 then 8300 to 8314 and 8391 to 8406.
Traders can sell at 8297 and risk a close over 8321 for three days in a row.
Stay tuned for Forex flashes and updates.
THE PRECIOUS METALS
FEBRUARY GOLD
Resistance should appear near 1232.0 to 1238.0 and the 1268 to 1274 region.
Support should appear near 1203.0 to 1192.0 and 1180.50. Below that buyers should appear near
1169.00 to 1164.00.
MARCH COPPER
Resistance should appear near 27590 to 27750 and the 28200 to 28290 region, which should cap an early rally. Beyond that sellers should appear near 28740 to 28830.
Support should appear near the 26720 to 26630 and the 26200 to 26120 region, which should hold.
MARCH SILVER
Support should appear near 1576 to 1569 and the 1535 to 1529 region. Below that a test of 1496 to 1484 is likely.
Resistance is at 1642 to 1655 and the 1689 to 1696 region. Beyond that sellers should appear near 1731 to 1738 and the 1774 to 1780 region..
THE EXCITING ENERGIES
FEBRUARY CRUDE OIL
Support should appear near 4717 to 4695 and the 4514 to 4503 region. Below that a test of 4446 to 4425 is likely.
Resistance should appear near 4915 to 4926 then 4973 to 4995 and 5056 to 5067. Beyond that
sellers should appear near 5127 to 5139.
MARCH CRUDE OIL
Support should appear near 4856 to 4845 then 4717 to 4695 and the 4514 to 4503 region.
Resistance should appear near 4973 to 4995 and 5056 to 5067. Beyond that sellers should appear near the 5200 to 5211 region.
MARCH BRENT CRUDE OIL
Support should appear near 5067 to 5056 and the 4926 to 4915 region. Below that a test of 4856 to 4845 is likely.
Resistance should appear near 5259 to 5282 and 5344 to 5356, Beyond that sellers should appear near 5553 to 5577 and should cap a rally.
FEBRUARY HEATING OIL
Support should appear near 16960 to 16890 and 16550 to 16420, below that a test of 16150 to 16090 is likely
Resistance should appear 17310 to 17380 and 17740 to 17800. Traders can sell at 17730 and hold for lower prices.
FEBRUARY UNLEADED GAS
Support should appear 13100 to 13040 and the 12740 to 12680 region. Below that a test of 12320 to 12030 is likely and should hold.
Resistance should appear near 13340 to 13460 and 13770 to 13830. Beyond that sellers should appear near14150 to 14210 and the 14590 to 14650 region and cap a rally.
MARCH NATURAL GAS
Support should appear near 2.883 to 2.874 and 2.775 to 2.758. Below that a test of 2.672 to 2.663 is likely.
Resistance should appear near 2.972 to 2.990 and 3.036 to 3.043. Beyond that sellers should appear near 309.2. to 3102 and the 3.148 to 3.157 region. Stay Tuned for Energy Flashes
THE GRANDE’ GRAINS
MARCH SOYBEANS
Support should appear near 1047, a close under augurs for a test of 1036 to 1032. Below that a test of 1013 ¾ to 1010 ½ is likely.
Resistance should appear near the 1058 to 1068 region. Beyond that sellers should appear near 1096 to 1101 and cap a rally.
MARCH SOYOIL
Support should appear near 3270 to 3261 and the 3213 to 3194 region. Below that a test of 3102 to 3092 is likely.
Resistance should appear near the 3377 to 3386 region. Beyond that sellers should appear near 3425 to 3443 and the 3493 to 3503 region and cap a rally.
MARCH SOYMEAL
Resistance should appear near the 355.3 to 356.3 and the 366.3 to 368.2 region. Beyond that sellers should appear near 3795 to 380.6 and cap a rally.
Support should appear near 344.3 to 342.5 and the 338.6 to 337.3 region. Below that a test of327.0 to 326.1 is likely and should hold.
MARCH CORN
Support should appear near 399 ¼ to 398 ¼ and the 386 ¾ to 385 ¾. Below that buyers should appear near 374 ¼ to 373 ¼ and contain a decline.
Resistance should appear near 411 to 412 and the 416 ¼ to 418 ¼ region. Beyond that sellers should appear near the 423 ¾ to 424 ¾ region.
MARCH WHEAT
Support should appear near 557 ¾ to 555 ¼ and the 550 ¼ to 549 ¾ region. Below that a test of 535 ¾ to 534 1/2 is likely.
Resistance should appear near 579 ¼ to 580 ½ and the 585 ½ to 588 region. Beyond that sellers should appear near 602 ¼ to 603 ½.
THE LIVELY LIVESTOCK
FEBRUARY CATTLE
Support should appear near 15760 to 15690, below that a test of 15350 to 15290 is likely.
Resistance should appear near 16090 to 16150 and the 16240 to 16550 region.
APRIL CATTLE
Support should appear near 15760 to 15690. Below that a test of 15350 to 15290 is likely to occur.
Resistance should appear near 16090 to 16150 then 16277 and the 16422 to 16557 region. Beyond that sellers should appear near the 16890 to 16960 region.
FEBRUARY HOGS
Support should appear near 7867 to 7837 then 7777 to 7762 and the 7692 to 7672 region.
Resistance should appear near 7937 to 7957 and 8027 to 8047. Beyond that sellers should appear near 8192 to 8223 and cap a rally.
APRIL HOGS
Support should appear near 7957 to 7932 and the 7867 to 7837 region.
Resistance should appear near 8117 to 8137 and 8192 to 8222. Beyond that sellers should appear near 8302 to 8317. Traders can sell at 8292 and hold for lower prices.
JUNE HOGS
Support should appear near 8872 to 8857 and 8777 to 8762. Below that 8682 to 8667 should hold.
Resistance should appear near 9037 to 9057 and the 9137 to 9157 region, where sellers should appear and cap a rally. Stay Tuned for Livestock Flashes.
THE SATISFYING SOFTS
MARCH COFFEE
Resistance should appear near 18080 to 18220 and 18580 to 18650. Beyond that sellers should appear near 19020 to 19090 and cap a rally.
Support should appear near 17380 to 17310 and the 16960 to 16890 region Below that buyers should appear near 16550 to 16420 and contain a decline.
MARCH COCOA
Resistance should appear near 3036 to 3045 and 3092 to 3102. Beyond that sellers should appear near 3148 to 3157 and cap a rally.
Support should appear near 2937 to 2928 and the 2883 to 2872 region. Failure there augurs for a test of 2775 to 2758.
MARCH SUGAR
Resistance is near 1496 and 1529 to 1535. Beyond that sellers should appear near 1560 to 1576,
Support should appear near 1459 to 1453 and 1421 to 1415. Below that a test of 1383 to 1377 is likely.
MARCH COTTON
Support should appear near 5957 to 5945 and the 5880 to 5855 region.
Below that at test of 5577 to 5553 is likely.
Resistance is at 6101 to 6113 and 6165 to 6190. Beyond that sellers should appear near 6337 to 6350.
Stay tuned for Flashes and Updates in all Markets
–A Ship in Harbor is Safe…But that is not what ships are built for –
Happy Trading!
Bill wil@futurescom.com
Saturday January 10th, 2015 10:00 PM South Florida Beach Time
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