FuturesCom Bi-Weekly Investment Outlook # 427 July 28 2013 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 July 27, 2013
4:00 AM South Florida Beach Time
Looking ahead to next week all eyes will be focused on comments after the Fed Open Market committee meeting on Wednesday , also Wednesday the US GDP will be released with Eurozone unemployment coming early Wednesday. The ECB and BOE meet on Thursday August 1. Jobless claims data will be tossed in at the same time, after that ISM data. US unemployment data will be released on Friday. Traders should note, August is right around the corner, trading volumes in many markets are likely to decline as family vacations occur. While volumes can decline, often volatility in price increases.
World leaders and politicians are closing up shop for the summer. Members of the US Congress leave for vacation next week for pretty much all of August. Thus traders will have a plethora of economic data and ‘official comments’ all week. Traders should stay tuned for additional flashes and updates for all markets as July ends and we begin August.
The Stock market continues to move a bit higher in a range-bound fashion against upper levels of resistance. Stock and Index Traders should remain nimble and look for increased volatility ahead over the next month. August can be a volatile month in stocks in preparation for October and November which are typically the best times to undergo some buying and hold strategies and that is still in front of us… Long term yearly technical patterns for US Stock Index Averages remain friendly. Long Term technical work for 30 Year U.S Treasury futures remain bearish and is not likely to change much. However, buying Sept or Dec at the end of July tends to make money during August.
Traders ‘who sleep on a bed of nails’ can probe at the long side. In previous issues we have gone over some overseas markets long term. If you need detailed analysis regarding overseas equity markets, please call the office or email a request.
Traders should stay tuned for flashes and trades from both sides of markets and be nimble. As of the close Friday, the Dollar is slightly lower on the year (really no change) the Euro is marginally higher the Bond Futures are substantially lower and stocks have enjoyed a great run. Crude continues to act well amid geopolitical uncertainties which may be heightened over the weekend. Prospects for US growth are supportive. Some may say the Crude rally is a bit overdone, however in the past crude prices have at times not peaked until late August and September. Over the Long term prices can accelerate and investors and traders should not be surprised to see higher prices. Ditto for Heating Oil, where prices can typically firm into August. Traders should look for a trading affair in energies for chances to buy and sell.
Foreign exchange traders should continue to consider the Japanese Yen futures as a trading affair. Long term; Spot USD/JPY remains bullish , bearish for Yen Futures. However Yen has stabilized can push higher with a weaker dollar yen into August. Some may say I am getting ahead of myself here but a plan is a plan. If a sharp decline during August occurs long term Forex traders should begin to nibble on the Spot Dollar /Yen and Sell Futures for trading purposes. The yen decline versus the dollar is likely about half way done and should reassert itself into next spring. The Nikkei looks weak and headed lower in late autumn. Japan may have to double up the rhetoric over the next year to achieve faster results or the whole thing blows up. Frankly, Japan simply may not be able to fund itself as its population decreases over the next decade. This may force the hands of Japanese policy makers to take more drastic action to avoid some really gloomy demographics. Increasing the consumption tax is part of this action. Look for more action and rhetoric into the 3rd quarter and beyond.
The US Dollar saw further erosion while Euro is pressing against 13340 to 13460, the upper edge of its broad trading range. Fed Talk, news stories and babble from governments have widened trading ranges and provide ample action on both sides of the markets. There is no change to our north of the US border posture regarding the Canuck, selling rallies is preferred for the long term, the short futures were covered Friday to reduce weekend exposure in a dull market a slip into early August should not be ruled out sell the rally for a trade and look for a two way market later in the month. The Aussie Dollar has bounced. Traders should look to sell rallies. Typically the Aussie peaks into July and then gets weaker into August and September. Lower prices are likely to be in front of the market not behind it. Consider the Aussie a trading affair and sell a rally early in the week for a sloppy August. Forex traders should consider Buying Yen against Aussie and look for firm mid to late August. The Kiwi rallied sharply after hawkish Central Bank comments. All the while, the central bank continues to opine about the strength of the Kiwi and considers the currency ‘too high. The Kiwi is up against monthly resistance.
Gold and silver along with Copper are showing some recovery. However Copper gave up its gains as China really is not aiding the long side there. Look for more weakness. Sell an early rally and look for a dip into early and the middle of August. Precious metals are volatile and lower on the year. On Friday we saw early pressure and a recovery at the end of the day in gold and silver. Look for more volatility in gold.
Soybeans fell apart, sell a rally. Soybeans and its products tend to grind lower in early August and many times until autumn harvest. If the Corn and Soybean focus shifts after the blistering decline, it will likely be due to prospects for an early freeze. Chicago Wheat typically makes its low into July harvest look for stabilization and perhaps a grind higher into autumn. Traders should look to buy and hold December Futures for the pull. Buying December Chicago Wheat and Selling December Corn at 175 to 180 should work. October Cattle tends to hold the June Lows into August so expect a two way market for now buy a dip to get long. Aggressive traders can buy October Cattle on the open Monday and hold for higher prices.
There were 564.924 million pounds of pork in cold storage at the end of June. Down over 14% from the month previous month and down 4.7% from last year and the lowest amount for any month since December. June was the first month with frozen pork stocks below the previous year level since November 2010. Beef, chicken and turkey all had more in cold storage then in June 2012.
August Hogs tend to firm into the end of July and up early August. Traders should buy August Hogs on the open Monday for a move up and stay tuned for a stop. October Hogs are trading at a wide premium to cash and should firm a bit. Traders can buy for a bounce. Additionally look to short October Hogs again on sharp rally. As well as December Hogs which normally bear the brunt of down moves into autumn. Coffee failed after a sharp weather rally and remains under pressure as global supplies exceed demand (the best cure for low prices is low prices). U.S. coffee consumption tends to rise in the winter and should aid coffee later in late fall and early winter, for now sell a rally if able and look for a trading affair in coffee, ditto for cocoa which can come under pressure until autumn. Aggressive traders should sell Dec cocoa at 2410 and look to hold until late October if able. Sugar has enjoyed a wet and cold weather bounce, the post July into October period is typically negative for Sugar prices. Supplies are still large and continue to overhang market. Cotton is sloppy is higher on the year however missed our sell region like soybeans by a hair. Chinese demand remains a concern. Sell a rally for a sloppy early part of August.
Traders should stay tuned for flashes and updates for all markets as July ends and we begin August.
Onto the Nitty Gritty
THE SENSATIONAL STOCK AND BOND MARKET
DOW JONES INDUSTRIAL AVERAGE
Support should appear near 15,350.00 to 15,290.00 and 15,125.0. Below that buyers should appear near 14,960.00 to 14,840.00 and contain a decline.
Resistance should appear near the 15,690.00 to 15,760.00 and the 16,090.00 to 16,160.00 region.
SEPTEMEBER E-MINI SP500
Resistance should appear near 1689.00 to 1696.00 and the 1731.00 to 1738.00 region.
Support should appear near 1672.00, a close under is negative and augurs for a test of the 1655 to
1642 region. Below that buyers should appear near 1628.50 and 1615.00 to 1609.00
Traders can buy at 1617.00 for a bounce and stay tuned for a stop.
NASDAQ COMPOSITE
Resistance should appear near 3613.00 to 3623.00 and the 3663.00 to 3682.00 region. Beyond that a test of 3734.00 to 3743 is likely and should cap a rally.
Support should appear near 3563.00 to 3553.00 and 3503 to 3493. .
SEPTEMBER E-MINI NASDAQ 100
Support should appear near 3045.00 to 3036.00 and 2990.00 to 2972.00. Below that buyers should appear near 2937 to 2928. Traders can buy at 2992.00 and risk a close under 2967.00 for three days in a row.
Resistance should appear near 3092.00 to 3102.00 and the 3148.00 to 3157.00 region. Where sellers should appear and cap a rally.
SEPTEMBER E-MINI RUSSELL 2000
Resistance should appear at the 1058.00 to 1068.00 region which should cap a rally
Support should appear near 1047.00 and the 1036.00 to 1032.00 region. A close under is negative and augurs for a test of and 1013.60 to 1010.40.
SEPTEMBER 30 YR BOND
Resistance should appear near 135-07, a close over is friendly and augurs for a test 135-21. Above that sellers should appear near 137-07 and 137-21. Beyond that sellers should appear near 138-07 and 138-21. Traders can sell at 138-21 and risk a close over 139-12 for three days in a row.
Support should appear near 134-21 and 133-21 and 133-07. Below that a test of 132-21 is likely and should hold for now. Traders can buy at 132-21 and risk a close under 132-06 for three days in a row. .
SEPTEMBER 10 YR NOTE
Resistance should appear near 127-07 and 127-21. Beyond that sellers should appear near 128-21 and 129-07 which should cap a rally. Above that resistance is near 129-21 and 130-07
Support should appear near 125-21 and 125-07, below that supports should appear near 124-21.
THE FRENZIED FOREX FRONT
SEPT DOLLAR INDEX
Resistance should appear near 8194 to 8223 and the 8300 to 8314 region.
Support should appear near 8134 to 8119, a close under is negative and augurs for a test of 8044 to 8029 region. Below that a test of 7954 to 7929 is likely.
SEPT JAPANESE YEN
Resistance should appear near 10237 and 10320 to 10360. Beyond that a test of 10470 and the 10580 to 10680 region is likely and should cap a rally. Traders can sell at 10577 for a quick trade and risk a close over 10587 for three days in a row.
Support should appear near 10136 to 10104 and 10037 to 10021 which should hold for now. Below that buyers should appear near 9937 to 9921 and the 9837 to 9821 region.
SEPT EURO CURRENCY
Support should appear near 13220 and the 13100 to 13040 region.
Nearby resistance should appear near 13340 to 13460, beyond that a test of 13610 is likely
.
SEPT SWISS FRANC
Resistance should appear near 10815 , a close over is friendly and augurs for a test of 10960 to 11010, beyond that a test of 11300 to 11360 is likely to occur and should cap a rally.
Support should appear near 10750, a slip under is negative and indicates a test of 10680 to 10580 which should hold.
SEPT BRITISH POUND
Support should appear near 15350 to 15290, a close under is negative and augurs for a test of 15125 and the 14960 to 14840 region.
Resistance should appear near 15525 and the 15690 to 15760 region
SEPT CANADIAN DOLLAR
Resistance should appear near 9821 to 9837 and the 9921 to 9937 region
Support should appear near 9641 to 9625 and 9546 to 9526 region.
Traders should go short if a close under 9705 occurs.
SEPTEMBER AUSSIE DOLLAR
Support should appear near 9156 to 9140 and 8964 to 8934 region.
Resistance should appear near 9237 then 9316 to 9347 and the 9429 to 9445 region.
BW Traders can sell at 9315 and hold for lower prices
THE PRECIOUS METALS
DECEMBER GOLD
Resistance should appear near 1377 to 1383 and 1415 to 1421.
Support is near 1310 to 1304 and the 1274 to 1268 region. Below that buyers should appear near the 1238 to 1232 region.
SEPTEMBER COPPER
Resistance should appear near the 31480 to 31570. Traders can sell at 31470 and risk a close over 31650 for three days in a row. Beyond that sellers should appear near 31940 to 32130 and the 326120 to 32760 region.
Support should appear near 30450 to 30360 and should contain a decline, failure there augurs for a test of 29900 to 29720 and the 29370 to 29280 region and appears more likely than not to occur.
SEPTEMBER SILVER
Resistance should appear near 2034 to 2042 and 2080 to 2089. Beyond that sellers should appear near 2126 to 2134.
Support is at the 1953 to 1946 region. Below that buyers should appear near 1909 to 1902 and the 1865 to 1858 region. Under that 1822 to 1808 should hold for now. Traders can buy at 1912 for a bounce and initially plan on risking a close under 1899 for three days in a row.
THE EXCITING ENERGIES
SEPTEMBER CRUDE OIL
Resistance should appear near 10580 to 10680. A close over is friendly and augurs for a test of 10960 to 11010. Beyond that a trade towards 11300 to 11360 is likely
Support should appear near 10360 to 10320 and 10136 to 10104 region. Below that buyers should appear near 10037 to 10021 and contain a decline. Traders can buy at 10040 and risk a close under 9980. Aggressive Traders should go long if a close over 10690 occurs.
Stay tuned for flashes.
SEPT HEATING OIL
Support should appear near should appear near 29900 to 29720 and the 29370 to 29280 region. Below that 28830 to 28740 should hold. Traders can buy at 28850 for a bounce and risk a close under 28650 for three days in a row.
Resistance should appear 30360 to 30450, a close over is friendly and augurs for a test of 30920 to 31020 and the 31480 to 31570 region. Beyond that a test 31940 to 32130 is likely.
Traders should go long if a close over 304.70 occurs.
SEPT UNLEADED GAS
Support should appear near 29900 to 29720 and 29370 to 29280. Below that buyers should appear near 28830 to 28740 and contain a decline.
Resistance should appear near 30920 to 31020 and 31940 to 32130. Beyond that sellers should appear near 32610 to 32700.
SEPT NATURAL GAS
Resistance should appear at 3613 to 3623, a close over is friendly and augurs for as test of the 3734 to 3743 region. Beyond that sellers should appear near 3813 to 3823
Support should appear near 3563 to 3553, failure to hold is negative and augurs for a test of the 3443 to 3425 region. Below that plentiful buyers should appear near 3270 to 32610 and contain a decline.
THE GRANDE’ GRAINS
SEPTEMBER SOYBEANS
Support should appear near 1274 to 1268 and the 1238 to 1232 region.
Resistance should appear near 1289 and the 1304 to 1310 region. Beyond that sellers should appear near 1334 to 1346 and cap a rally
NOVEMBER SOYBEANS
Support should appear near 1203 to 1192 and 1169 to 1164
Resistance should appear near 1232 to 1238 and 1253. Traders can sell at 1252 and risk a close over 1257 for three days in a row.
DECEMBER SOYOIL
Resistance should appear near 4424 to 4446 and 4503 to 4514. Traders can sell at 4502 and hold for lower prices.
Support should appear near 4315 to 4304 and the 4249 to 4238 region.
DECEMBER SOYMEAL
Resistance should appear near 373.4 to 374.3 and the 385.8 to 386.7 region. Beyond that sellers should appear near 390.9 to 392.9 and cap a rally.
Support should appear near 362.3 to 361.3 , a close under is negative and augurs for as test of 356.3 to 355.3.and the 344.3 to 342.5 region.
SEPT CORN
Support should appear near 485 ¾ to 484 ¾ and the 478 ½ to 477 ¾ region.
Resistance should appear near 497 ¼ to 499 ½ , a close over is friendly and augurs for a test of 505 ½ to 506 ¾ and the 512 ¾ to 513 ¾ region. Beyond that sellers should appear near 525 ¾ to 528 ¼ and cap a rally.
DEC CORN
Support should appear near 471 ¾ to 469 ½ failure there is negative and indicates a test of the 458 ¼ to 457 ¼ region. Below that 444 ¾ to 442 ½ should hold.
Resistance should appear near 477 ½ to 478 ¾, a close over is friendly and augurs for a test of 484 ½ to 485 ¾. Beyond that sellers should appear near 497 ¼ to 499 ½ and the 505 ¾ to 506 ¾ region.
SEPT WHEAT
Resistance should appear near 657 ¾ to 659 ¾. A close over is friendly and augurs for a test of 665 ¾ to 667 ¼ and the 674 ¾ to 675 ½ region.
Support should appear near 643 to 641 ¾ and 635 to 633 ½
DEC WHEAT
Resistance should appear near 665 ¾ to 667 ¼. Beyond that a test of 674 ¾ to 675 ½ is likely.
Support should appear near 659 1/4 to 657 ¾ and the 650 ¾ to 648 ¾ region.
Traders should go long if close over 669 occurs.
THE LIVELY LIVESTOCK
OCTOBER CATTLE
Support should appear near 12537 and 12447. Below that a test of 12380 to 12320 is likely and should hold.. Traders can buy at 12387 for a bounce, risk a close under 12317 for three days in a row..
Resistance should appear near the 12680 to 12740, a close over is friendly and augurs for a test of and 12817. Beyond that sellers should appear near 13040 to 13100.
AUGUST HOGS
Support should appear near the 9737 to 9707 and 9642 to 9622
Resistance should appear near 9822 to 9837 and should cap an early rally . A close over is friendly and augurs for a test of 9922 to 9937 region.
OCTOBER HOGS
Support should appear near 8407 to 8392. Traders can buy at 8412 and risk a close under 8387 for three days in a row. Below that 8317 to 8302 should hold.
Resistance should appear near 8487 to 8502 a close over is friendly and augurs for a test of 8557 to 8587 and the 8667 to 8682 region. Traders can sell at 8762 and risk a close over 8782 for three days in a row.
DECMBER HOGS
Support should appear near 8137 to 8117 and the 8048 to 8027 region. Below that buyers should appear near 7957 to 7932.
Resistance should appear near 8192 to 8222 and the 8300 to 8317 region. A close over is friendly and augurs for a test of 8392 to 8407 and the 8482 to 8487 region, which should cap a rally.
Traders can sell at 8477 and hold for lower prices.
THE SATISFYING SOFTS
SEPT COFFEE
Support should appear near 12030 to 11920.. Below that a test of 11690 to 11640 is likely. Failure there augurs for a test of 11360 to 11300 and the 111010 to 10960 region.
Resistance should appear near 12320 to 12380 and the 12680 to 12740 region. BW Traders can sell at 12670 and initially risk a close over 12775 for three days in a row.
SEPT COCOA
Resistance should appear near 2354 to 2370 and the 2411 to 2419 region.
Support should appear near 2322 to 2315 a close under is negative and augurs for a test of 2275 to 2267 and eventually the 2226 to 2219 region.
OCT SUGAR
Resistance is near 1689 to 1696 and the 1731 to 1738 region. Above that sellers should appear near 1774 to 1780. Traders can sell at 1730 and hold for lower prices.
Support should appear near 1615 to 1609, a close under is negative and augurs for a test of 1576 to 1569 and the 1535 to 1529 region..
DEC COTTON
Support should appear near 8406 to 8391 and 8314 to 8300. Below that a test of 8044 to 8029 is likely and should hold. Traders can buy at 8055 and risk a close under 7935 for three days in a row.
Resistance is 8560 to 8589 and 8668 to 8683. Traders can sell at 8555 and hold for lower prices.
Beyond that sellers should appear near 8762 to 8777 and cap a rally.
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 July 27, 2013 11:30 PM South Florida Beach Time
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