Stocks..
Spu’s…the Sept Futures will need to close over 1590.50 to hold up
Macro support and next tgt. is 1562 followed by 1532, levels that will not change.
Nasd 100…2888 is closing resistance.
2800-05 is the next tgt & support.
Bonds…
30 Yr. Bonds…135.00 + a few was matching Fib support and now becomes the upside pivot.
Day Traders should be selling every opening range failure with a tight stop. The world is under weight this trade.
The Bonds are getting very oversold on the short term time frames. The mid to low 133’s is possible to bounce.
Most traders have been trying to pick this top ( bottom in rates) for 2 years and getting smoked. Now that it’s here I think very few are in. This will be a must have trade for Fund
managers. It will be akin to being underweight Equity Indices on the way up this year.
I’ve been out for 6 points waiting for a rally and I doubt you’ll get much more than a mid-week
wiggle up to nowhere. Be patient with your technical s. Sell rallies to nowhere.
Bunds…141.15 will be pivotal for more downside. 142 is short term resistance.
FX…
AUD/USD… All new weakness under 91.50 is needed for another leg down in the Aussie.
We’ll sell this @ 96.65 if we get the chance over the next few weeks.
USD/JPY…98.85-99.20 is closing Yen support. 100.70 Futures +- 20 ticks will become support and the downside pivot. 97.45 is Yen resistance ( app 102.60 Futures) and the upside pivot.
EUR/AUD…141.14 is support and the downside pivot.
EURO…130.70-80 will be pivotal. This is the 50 & 200 day. Maintaining below will lead to a test of 130. Sustained Price action under 129.50 is needed for lower.
Commodities…
Precious metals…as much as I’d like to give them a go from the long side,
I think you just have to wait until next week to see how the qtr end markings play out.
Oil…use 94 as your short term pivot. This can probe just below 93 on an initial wiggle down.
Macro support starts @ 90 down to 89.33.
General Comments or Valuable Insight
The board has been another opening range trade from the Asian session with the
Bonds running the show.
I do not see any incentive to be long equities going through the summer. This is
traditionally a time of thin markets and high volatility.
The Spu’s are up 160 points on the year even after a 100 point sell off. We’ve seen a catalyst
present itself every summer that has the indices taking a swan dive near to the previous years close or lower.
I don’t see why this year should be any different. The risk is now that investors have not taken profits, which leaves us with an inordinate risk to the downside, not the up over the near term.
I’m looking for markets to maintain their current trends going into the end of the qtr, which is Friday. Bonds down ( Interest rates up) Equities Down, Dollar firm.
Short Term View…
Trade what is in front of you. Don’t fight the flow!
It’s ok to miss a trade no matter how painful it may be to your psyche.
Note…we always write a stop with any instrument we‘re interested in. As the instruments become profitable those stops should be raised to your entry level so you don’t lose money.