DE…a close over 78 puts in an ORH week
CVX…104.65 for an ORH week
Oil… 80.80-95 is resistance with buy stops above, with 82 ish being the next closing hurdle.
Euro..126.20-30 is pivotal.
CAD/JPY…put in a double bottom @ 76.60. 77.97 is the 200 day mvg avg.
AUD/USD…102.50 is the 200 day mvg avg. Closing over 102.25 puts in an ORH week.
General Comments…
CAD/JPY and AUD/USD are important Risk On indicators!!! Only sustaining above those upper levels can you expect stocks to follow through to the upside.
Today is month end and only the closes are important to us.
Short term traders can play the daily game against the Bots.
Our focus will remain in the Natgas names and the energy names in general, where risk and trade location have proved definable.
Grains will be active for the foreseeable future. We’re in buy the 8-10% break mode in the related ETf’s & ETN’s
We will be updating our medium term forecast over the weekend
Model Trading Portfolio
……………..
Long TBT 15.30
Short Term View…Every Trade is the same trade. It’s either Risk On or Risk Off.
It’s time to hit singles, then take the money and run. The board is trading Risk Off with rallies for the past month, in all Risk assets, being met with sellers.
Location ,Location,Location….If you have a good trad able pattern “Good Risk reward!” You just have to seize the opportunity and see what develops!
Take what the market gives you, will be the order of the day.
Trade to Make Money!
Medium Term View…
30 Yr. Bonds … 138.00 ish now becomes our macro pivot. Closing above this level would be short term positive the Bonds and negative the Equities. We will look to buy a multi-point break in the 30 for a rally into the fall in keeping with a general risk averse market theme.
Equities…While, we were in strategic buy mode for the first quarter, we now believe the market is fairly priced. The equity indices deserve a break. The operative question becomes, from what level and when can a break develop. We will monitor instruments on an individual basis vs. the general Risk On/ Risk Off correlation we saw last year, when most instruments traded via the theme of the day.
Copper…We’re looking to sell all rallies in the Copper against a 377 weekly close. We regard this as an ancillary short to the general Risk off theme we see going forward late into this qtr. Weekly closes much over 382 will give us pause to re-evaluate our premise.
I’ve been doing this 35+ years…I’m hard pressed to recall a year when we haven’t gone back and attempted a retest of the yearly close in the equity indices at least once. Yes, we are looking for a re-test in the next few months.
We are going to be highly flexible this qtr…..we are not getting married to a central theme, nor are we getting into the long term prediction business. Having a bias is one thing, being patient and executing with a defined risk parameter another. Our business is “Intelligent Risk Management”.
Currencies…AUD/USD continues to be a good risk barometer. 102 is the near term macro pivot! ( This is a multi-year level) 111 is the upside pivot. Anything in between is just that, in between….no break outs! Closes above 105.30 would be deemed near term positive.
Natgas…we’re looking to buy this @ the 1.70 level.