Good evening,
Take a look at the latest trading log here
The S&P 500 futurs traded to a high of 1337 today, 0.50 points above Friday's high. Today's volume was relativly very low, 1.377m S&P 500 Emini contracts traded, which is the lowest volume day since the September became the front month. The next key resistance is now the 1340.25 high from 31st of May. Technically the bullish momentum is strong above today's low at 1329.25. The key support is down at the 1317, the break out level from Friday.
Trading wise I added one more 1320 put for 15 of July expiration, because I think the risk on theme will be supported for another few sessions and that is a decent hedge against the short 1340 Aug and 1350 Aug calls.
Crude had a nice break out above 96 key resistance and I went long at 96.05 and took profit at 96.50.
I also closed the Euro structure for a total profit of 237 USD on the 2 put spread done over the last week. Given that we didn't see the move towards 1.4350 I was looking for it was decent as the % payback on the premium paid was 54%.
In general I like to put my main focus on making money and not so much about being correct on all the analysis. The point is that the risk management and position adjustment are very important. Because most of the time I will not be spot on with the analysis, so it becomes very important to be able to make money even though one is a bit off on the market analysis.
Good luck
Daily blog with thoughts and comments on the futures and forex markets through the eyes of Per-Erik Karlsson, Ceo at Avantage Financial, Switzerland.
tirsdag 5. juli 2011
Market Report Tuesday 5th of July
See the full pdf version here
Daily Market Report for Tuesday 5th of July 2011
Sign up to receive the daily report directly by email (fill out form at this page): http://avantagefinancial.ch/contact?avantagefinancial_ch=5b87a7ae083a034fb21f15a963ab7882
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Very quiet day yesterday with the US markets closed in observance of Independence Day. It seems like the “risk on” theme continues this morning and we are heading back up in the metals and crude. Both gold and crude have broken above key resistance levels, 1502 and 96.00 respectively. It is key now that these gains hold and not get any kind of sell off into the close, because that would really invite for sellers to take over. Euro is not doing too much to the upside yet, but given that we are in the upper end of the recent range I think we need to get some fresh news to extend above the 1.4564 resistance level. We have ECB and US NFP report later this week, which are the next major events on the economic calendar.
My thinking is that the European debt crisis will not go away quickly and probably come back to hit us sooner rather than later. We have had a nice rally in the S&P 500 over the last 2 weeks, but from here it will be more difficult to go higher in my opinion. With the QE2 over as well, the support for the equity markets could be thin during the summer months. Technically the 1340 resistance is an important level to get above to continue to the upside. I suspect a lot of traders looking to short up around the 1330 to 1340 and stops above 1361.75, the yearly high. It would be healthy for the rally to get some kind of pullback before going higher, if not I am afraid the selling pressure will get too big on any break higher. Friday’s break out level of 1317 is now support.
CHF out performing this morning as the recent losses corrects a bit. I reckon the next level to look long is around in the 1.2050 in EURCHF.
I am still looking to add some type of position in Corn following the huge sell off week, but I have not made up my mind what the position will be yet. I will come back on that during the next few sessions.
Looking at a few interesting points in the markets trading wise:
- 76,4% Fibonacci retracement of the 1361.75 – 1252.25 move comes in at 1336, which was right around the Friday’s high (1336.50). The high from 31st of May at 1340.25 is the next key target. Break out level of 1317 is now key support.
- Crude punching through the 96.00 resistance today, next key level is 98.00.
- Silver bouncing off the lower end of the last month’s range of 32.75 to 38.76. Can we head back up towards the upper end of the range?
- Gold have broken above 1502 key resistance, next upside target is 1520.
- Key resistance in Euro up at 1.4564, which I expect to hold for the next 2 sessions.
Technical’s and comments
Euro: The break above 1.45 Friday opens for an extension higher as I think we will see the risk on theme continue going into the NFP report Friday. The resistance levels today are the low from 7th of June at 1.4564 and the high from the same day at 1.4695. We have support at the 3 days’ low of 1.4436.
Cable: Looks like a better choice to short GBP than Euro at the moment as we have broken above the key resistance level at 0.90 in EURGBP. First upside level to get short I figures is around the 1.61 level and stop above 1.6150 or so.
USDJPY: Very tight range over the last sessions. I remain longer term bearish on the JPY as the fundamental factors in Japan looks ugly, with huge public debt and unfavorable demographics going forward. However the risk off over the last days has taken us below 80 again. Not sure if we see any intervention unless the move picks up in speed and magnitude. Buy on dips for the brave.
Swissy: Have resistance at 0.85 at the moment, which is the pivot level in this pair for now I think. Bearish below this level and bullish above.
AUDUSD: We have strong resistance around the 1.0750 level, so would not chase the price action above that level. The buy in level of 1.0550 or so is the place I would look to try long again.
USDCAD: Rapid move lower and I think it makes sense to wait for a rally back up towards 0.9730 or to get short again.
S&P Future (ES): We have key resistance up at 1340.25 and minor resistance at 1336. Looks overbought and selling rallies below 1340 looks the most attractive today. If we break 1340, I would reverse to look long. Key support is not Friday’s break out level of 1317.
Gold: Falling resistance of 1502 was taken out this morning, this opens for a run towards 1520 resistance next.
Crude oil: Took out the 96 key resistance this morning and it is key that we hold the gains today into the close to open for higher levels. The next key resistance is 98. Key support is still down at 92.90.
________________________________________
Risk Warning: Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by Avantage Financial GmbH with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Regardless of the account type you choose, there are risks inherent in trading, including the risk of loss greater than the original investment. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice. Prices can go down as well as up. Past performance is no guarantee of future results.
Daily Market Report for Tuesday 5th of July 2011
Sign up to receive the daily report directly by email (fill out form at this page): http://avantagefinancial.ch/contact?avantagefinancial_ch=5b87a7ae083a034fb21f15a963ab7882
Follow our live trades at: http://twitter.com/AFtrading
Make sure to check out our blog as well: http://avantagefinancial.blogspot.com/
Very quiet day yesterday with the US markets closed in observance of Independence Day. It seems like the “risk on” theme continues this morning and we are heading back up in the metals and crude. Both gold and crude have broken above key resistance levels, 1502 and 96.00 respectively. It is key now that these gains hold and not get any kind of sell off into the close, because that would really invite for sellers to take over. Euro is not doing too much to the upside yet, but given that we are in the upper end of the recent range I think we need to get some fresh news to extend above the 1.4564 resistance level. We have ECB and US NFP report later this week, which are the next major events on the economic calendar.
My thinking is that the European debt crisis will not go away quickly and probably come back to hit us sooner rather than later. We have had a nice rally in the S&P 500 over the last 2 weeks, but from here it will be more difficult to go higher in my opinion. With the QE2 over as well, the support for the equity markets could be thin during the summer months. Technically the 1340 resistance is an important level to get above to continue to the upside. I suspect a lot of traders looking to short up around the 1330 to 1340 and stops above 1361.75, the yearly high. It would be healthy for the rally to get some kind of pullback before going higher, if not I am afraid the selling pressure will get too big on any break higher. Friday’s break out level of 1317 is now support.
CHF out performing this morning as the recent losses corrects a bit. I reckon the next level to look long is around in the 1.2050 in EURCHF.
I am still looking to add some type of position in Corn following the huge sell off week, but I have not made up my mind what the position will be yet. I will come back on that during the next few sessions.
Looking at a few interesting points in the markets trading wise:
- 76,4% Fibonacci retracement of the 1361.75 – 1252.25 move comes in at 1336, which was right around the Friday’s high (1336.50). The high from 31st of May at 1340.25 is the next key target. Break out level of 1317 is now key support.
- Crude punching through the 96.00 resistance today, next key level is 98.00.
- Silver bouncing off the lower end of the last month’s range of 32.75 to 38.76. Can we head back up towards the upper end of the range?
- Gold have broken above 1502 key resistance, next upside target is 1520.
- Key resistance in Euro up at 1.4564, which I expect to hold for the next 2 sessions.
Technical’s and comments
Euro: The break above 1.45 Friday opens for an extension higher as I think we will see the risk on theme continue going into the NFP report Friday. The resistance levels today are the low from 7th of June at 1.4564 and the high from the same day at 1.4695. We have support at the 3 days’ low of 1.4436.
Cable: Looks like a better choice to short GBP than Euro at the moment as we have broken above the key resistance level at 0.90 in EURGBP. First upside level to get short I figures is around the 1.61 level and stop above 1.6150 or so.
USDJPY: Very tight range over the last sessions. I remain longer term bearish on the JPY as the fundamental factors in Japan looks ugly, with huge public debt and unfavorable demographics going forward. However the risk off over the last days has taken us below 80 again. Not sure if we see any intervention unless the move picks up in speed and magnitude. Buy on dips for the brave.
Swissy: Have resistance at 0.85 at the moment, which is the pivot level in this pair for now I think. Bearish below this level and bullish above.
AUDUSD: We have strong resistance around the 1.0750 level, so would not chase the price action above that level. The buy in level of 1.0550 or so is the place I would look to try long again.
USDCAD: Rapid move lower and I think it makes sense to wait for a rally back up towards 0.9730 or to get short again.
S&P Future (ES): We have key resistance up at 1340.25 and minor resistance at 1336. Looks overbought and selling rallies below 1340 looks the most attractive today. If we break 1340, I would reverse to look long. Key support is not Friday’s break out level of 1317.
Gold: Falling resistance of 1502 was taken out this morning, this opens for a run towards 1520 resistance next.
Crude oil: Took out the 96 key resistance this morning and it is key that we hold the gains today into the close to open for higher levels. The next key resistance is 98. Key support is still down at 92.90.
________________________________________
Risk Warning: Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by Avantage Financial GmbH with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Regardless of the account type you choose, there are risks inherent in trading, including the risk of loss greater than the original investment. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice. Prices can go down as well as up. Past performance is no guarantee of future results.
Trading log update 18:20 CET Tue 5th July
Good afternoon,
I have updated the trading log with today's trades so far.
One Crude oil intra day trade for 225 USD and I have closed out the Euro options for a 237 USD profit. Paid 250 USD for that strucuture and made 262, so all in all decent All in I made 237 USD on those 2 Euro options structure that will be booked today.
See the trading log here
I have updated the trading log with today's trades so far.
One Crude oil intra day trade for 225 USD and I have closed out the Euro options for a 237 USD profit. Paid 250 USD for that strucuture and made 262, so all in all decent All in I made 237 USD on those 2 Euro options structure that will be booked today.
See the trading log here
mandag 4. juli 2011
Trading recap 4th of July
Did just one trade today, sold 1x 1320 puts for expiration at 15 July for 8,75 points.
My thinking is that the risk on from last week will extend towards the NFP report out Friday. That will be the next big event risk in my opinion.
We need to see a recovery in the US jobs market to see any new yearly highs in the S&P 500. The latest trend of the US data have been for a slight recovery, meaning the weak set of data that we seen for a few months is about to reverse for the better. Seems like the market is pricing in a decent NFP report now. Another weak number would definately cause the biggest potential move.
The updated trading log can be seen here
Good luck
My thinking is that the risk on from last week will extend towards the NFP report out Friday. That will be the next big event risk in my opinion.
We need to see a recovery in the US jobs market to see any new yearly highs in the S&P 500. The latest trend of the US data have been for a slight recovery, meaning the weak set of data that we seen for a few months is about to reverse for the better. Seems like the market is pricing in a decent NFP report now. Another weak number would definately cause the biggest potential move.
The updated trading log can be seen here
Good luck
Market report Monday 4th of July
See full pdf version here
The ISM came out better than expected Friday and the prices paid component came in lower than expected. A perfect mix for more “risk on”. This was confirmed by the break above 1317 in the S&P 500 futures and I would not be surprised to see an extension in “risk on” throughout the next few sessions as we are heading towards the release of the US non-farm payrolls (NFP) on Friday, which is big joker card. I think we need to see an improvement in the NFP report from last month’s weak 54k and preferably an upward revision to last month’s number to have a shot at breaking the yearly high in the S&P 500 futures at 1361.75. The expectations on the NFP range from +50k to 160k.
The next 12bn Euro tranche of aid to Greece was approved over the Weekend by the Eurogroup.
http://www.telegraph.co.uk/finance/financialcrisis/8612594/Greeces-latest-aid-injection-approved-by-eurozone-finance-ministers.html
This of course helps the risk sentiment as well. However I am not sure we have seen the last of the Greek story this week as comments out of S&P this morning says they would consider the voluntary swap of Greek bonds to longer maturities as proposed by France would indeed be looked upon as a default. This would basically mean that ECB cannot long accept Greek government paper as collateral and this would mean we have a Greek bank crisis on our hands. So, I will keep watching the news and stay flexible going forward as things can change for the worse instantly.
The latest risk rally has seen Swiss Franc getting crushed across the board and EURCHF is above 1.23 this morning. The weak Swiss PMI on Friday of course helped a lot too. Looks to me like SNB will lag behind ECB to raise rates and therefore the CHF should weaken further. I called this rally last week and said it would trade to at least 1.22 when it was at 1.19. I favor more upside medium term as the CHF looks very expensive in my opinion. Near term a dip lower ahead of 1.2350 looks likely.
Crude did indeed trade lower start of Friday as I expected after the failure to take out the 96 resistance for 2 consecutive days (Wednesday and Thursday). We got to a low of 93.45 before the ISM release put a solid bid that took us back up to close at 94.92. The key falling resistance is coming in at 95.25 today and would like to see a daily close above this trend line to look for a leg higher. Key resistance remains 96. A move below 92.90 support would open for a deeper move lower.
I am still looking to add some type of position in Corn following the huge sell off week, but I have not made up my mind what the position will be yet. I will come back on that during the next few sessions.
I expect today’s sessions to be very range bound as the US markets are closed in observance of Independence Day and no major economic news scheduled this afternoon. We have the RBA rate announcement at 06:30 tomorrow morning, no change is the market expectation.
Looking at a few interesting points in the markets trading wise:
- 76,4% Fibonacci retracement of the 1361.75 – 1252.25 move comes in at 1336, which was right around the Friday’s high (1336.50). The high from 31st of May at 1340.25 is the next key target. Break out level of 1317 is now key support.
- We have Independence Day in the US on Monday, meaning the US market is closed.
- We still have key resistance at 96 in Crude and could be interesting to place some buy stops just above that level to look for a stop drive higher if that level gets broken.
- Silver is approaching the lower end of the last month’s range, range 32.75 to 38.76.
- Gold is bearish below the falling resistance at 1502 today.
- Euro’s break above 1.4500 opens for a test of key resistance at 1.46, expect dips to be supported towards 1.4450 to be supported the next few sessions.
Interesting headlines:
EU Rescue Effort May Prompt Greek Default Rating - Bloomberg
http://www.bloomberg.com/news/2011-07-04/greek-rescue-effort-by-europe-may-earn-the-country-default-rating-from-s-p.html
S&P deals blow to Greek bail-out plan - FT
http://www.ft.com/intl/cms/s/0/e69610e4-a60a-11e0-8eef-00144feabdc0.html#axzz1R95wOA4I
Economic Outlook: Focus returns to US jobs – FT
http://www.ft.com/intl/cms/s/0/8bc8de8a-a3e9-11e0-9f5c-00144feabdc0.html#axzz1R95wOA4I
A Brady plan to end Europe’s crisis – FT
http://www.ft.com/intl/cms/s/0/dd0ad29c-a5a3-11e0-83b2-00144feabdc0.html#axzz1R95wOA4I
Technical’s and comments
Euro: The break above 1.45 Friday opens for an extension higher as I think we will see the risk on theme continue going into the NFP report Friday. The resistance levels today are the low from 7th of June at 1.4564 and the high from the same day at 1.4695. We have risings support at 1.45 followed by 2 days’ low at 1.4436.
Cable: Looks like a better choice to short GBP than Euro at the moment as we have broken above the key resistance level at 0.90 in EURGBP. First upside level to get short I figures is around the 1.61 level and stop above 1.6150 or so.
USDJPY: Very tight range over the last sessions. I remain longer term bearish on the JPY as the fundamental factors in Japan looks ugly, with huge public debt and unfavorable demographics going forward. However the risk off over the last days has taken us below 80 again. Not sure if we see any intervention unless the move picks up in speed and magnitude. Buy on dips for the brave.
Swissy: Strong move higher in the EURCHF as we are once again above the 1.2300 level. Medium term I expect the CHF to underperform vs. Euro as SNB will be lagging ECB on the rate hiking front. Have resistance at 0.85 at the moment, which is the pivot level in this pair for now I think. Bearish below this level and bullish above.
AUDUSD: We have strong resistance around the 1.0750 level, so would not chase the price action above that level.
USDCAD: Rapid move lower and I think it makes sense to wait for a rally back up towards 0.9730 or to get short again.
S&P Future (ES): Ended yesterday higher as I expected, although a bit higher then I had anticipated. Have key falling resistance from the yearly highs coming in at 1317. Expect a move lower to 1292 support over the next 3 sessions.
Gold: Broken to the downside technically and next downside target is 1464. I would not go short at current levels as we have seen plenty of bounces in this region. If long I would prefer to use options or possibly long futures and sell some calls against the long futures to give a bit more flexibility.
Crude oil: Failed at 96 resistance on 2nd consecutive days last week. We have interim falling resistance at 95.25 today and would like to see a daily close above this level to get me excited about a possible rally. Key support is 92.90.
________________________________________
Risk Warning: Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by Avantage Financial GmbH with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Regardless of the account type you choose, there are risks inherent in trading, including the risk of loss greater than the original investment. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice. Prices can go down as well as up. Past performance is no guarantee of future results.
The ISM came out better than expected Friday and the prices paid component came in lower than expected. A perfect mix for more “risk on”. This was confirmed by the break above 1317 in the S&P 500 futures and I would not be surprised to see an extension in “risk on” throughout the next few sessions as we are heading towards the release of the US non-farm payrolls (NFP) on Friday, which is big joker card. I think we need to see an improvement in the NFP report from last month’s weak 54k and preferably an upward revision to last month’s number to have a shot at breaking the yearly high in the S&P 500 futures at 1361.75. The expectations on the NFP range from +50k to 160k.
The next 12bn Euro tranche of aid to Greece was approved over the Weekend by the Eurogroup.
http://www.telegraph.co.uk/finance/financialcrisis/8612594/Greeces-latest-aid-injection-approved-by-eurozone-finance-ministers.html
This of course helps the risk sentiment as well. However I am not sure we have seen the last of the Greek story this week as comments out of S&P this morning says they would consider the voluntary swap of Greek bonds to longer maturities as proposed by France would indeed be looked upon as a default. This would basically mean that ECB cannot long accept Greek government paper as collateral and this would mean we have a Greek bank crisis on our hands. So, I will keep watching the news and stay flexible going forward as things can change for the worse instantly.
The latest risk rally has seen Swiss Franc getting crushed across the board and EURCHF is above 1.23 this morning. The weak Swiss PMI on Friday of course helped a lot too. Looks to me like SNB will lag behind ECB to raise rates and therefore the CHF should weaken further. I called this rally last week and said it would trade to at least 1.22 when it was at 1.19. I favor more upside medium term as the CHF looks very expensive in my opinion. Near term a dip lower ahead of 1.2350 looks likely.
Crude did indeed trade lower start of Friday as I expected after the failure to take out the 96 resistance for 2 consecutive days (Wednesday and Thursday). We got to a low of 93.45 before the ISM release put a solid bid that took us back up to close at 94.92. The key falling resistance is coming in at 95.25 today and would like to see a daily close above this trend line to look for a leg higher. Key resistance remains 96. A move below 92.90 support would open for a deeper move lower.
I am still looking to add some type of position in Corn following the huge sell off week, but I have not made up my mind what the position will be yet. I will come back on that during the next few sessions.
I expect today’s sessions to be very range bound as the US markets are closed in observance of Independence Day and no major economic news scheduled this afternoon. We have the RBA rate announcement at 06:30 tomorrow morning, no change is the market expectation.
Looking at a few interesting points in the markets trading wise:
- 76,4% Fibonacci retracement of the 1361.75 – 1252.25 move comes in at 1336, which was right around the Friday’s high (1336.50). The high from 31st of May at 1340.25 is the next key target. Break out level of 1317 is now key support.
- We have Independence Day in the US on Monday, meaning the US market is closed.
- We still have key resistance at 96 in Crude and could be interesting to place some buy stops just above that level to look for a stop drive higher if that level gets broken.
- Silver is approaching the lower end of the last month’s range, range 32.75 to 38.76.
- Gold is bearish below the falling resistance at 1502 today.
- Euro’s break above 1.4500 opens for a test of key resistance at 1.46, expect dips to be supported towards 1.4450 to be supported the next few sessions.
Interesting headlines:
EU Rescue Effort May Prompt Greek Default Rating - Bloomberg
http://www.bloomberg.com/news/2011-07-04/greek-rescue-effort-by-europe-may-earn-the-country-default-rating-from-s-p.html
S&P deals blow to Greek bail-out plan - FT
http://www.ft.com/intl/cms/s/0/e69610e4-a60a-11e0-8eef-00144feabdc0.html#axzz1R95wOA4I
Economic Outlook: Focus returns to US jobs – FT
http://www.ft.com/intl/cms/s/0/8bc8de8a-a3e9-11e0-9f5c-00144feabdc0.html#axzz1R95wOA4I
A Brady plan to end Europe’s crisis – FT
http://www.ft.com/intl/cms/s/0/dd0ad29c-a5a3-11e0-83b2-00144feabdc0.html#axzz1R95wOA4I
Technical’s and comments
Euro: The break above 1.45 Friday opens for an extension higher as I think we will see the risk on theme continue going into the NFP report Friday. The resistance levels today are the low from 7th of June at 1.4564 and the high from the same day at 1.4695. We have risings support at 1.45 followed by 2 days’ low at 1.4436.
Cable: Looks like a better choice to short GBP than Euro at the moment as we have broken above the key resistance level at 0.90 in EURGBP. First upside level to get short I figures is around the 1.61 level and stop above 1.6150 or so.
USDJPY: Very tight range over the last sessions. I remain longer term bearish on the JPY as the fundamental factors in Japan looks ugly, with huge public debt and unfavorable demographics going forward. However the risk off over the last days has taken us below 80 again. Not sure if we see any intervention unless the move picks up in speed and magnitude. Buy on dips for the brave.
Swissy: Strong move higher in the EURCHF as we are once again above the 1.2300 level. Medium term I expect the CHF to underperform vs. Euro as SNB will be lagging ECB on the rate hiking front. Have resistance at 0.85 at the moment, which is the pivot level in this pair for now I think. Bearish below this level and bullish above.
AUDUSD: We have strong resistance around the 1.0750 level, so would not chase the price action above that level.
USDCAD: Rapid move lower and I think it makes sense to wait for a rally back up towards 0.9730 or to get short again.
S&P Future (ES): Ended yesterday higher as I expected, although a bit higher then I had anticipated. Have key falling resistance from the yearly highs coming in at 1317. Expect a move lower to 1292 support over the next 3 sessions.
Gold: Broken to the downside technically and next downside target is 1464. I would not go short at current levels as we have seen plenty of bounces in this region. If long I would prefer to use options or possibly long futures and sell some calls against the long futures to give a bit more flexibility.
Crude oil: Failed at 96 resistance on 2nd consecutive days last week. We have interim falling resistance at 95.25 today and would like to see a daily close above this level to get me excited about a possible rally. Key support is 92.90.
________________________________________
Risk Warning: Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by Avantage Financial GmbH with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Regardless of the account type you choose, there are risks inherent in trading, including the risk of loss greater than the original investment. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice. Prices can go down as well as up. Past performance is no guarantee of future results.
lørdag 2. juli 2011
Trading recap Friday 1st of July
I was looking for a down move in S&P 500 and Euro today and it started in that direction at the start of the US session, looking like risk was coming off a bit in the early part of the US session. Then we had the US ISM coming out better than expected and S&P just blew out the 1317 resistance on the spike following the release. At the end of the day S&P 500 emini futures closes up 19,75 points or 1,50% at 1334.75. We closed right at the 61,8% Fibonacci retracement of the 1361 to 1252 move.
Last Friday, the S&P 500 futures closed at 1262 and the world was looking terrible with all kinds of default and one week later everything is all good and we are less than 30 points off the yearly high. What a turn around.
We have the long weekend now with the US markets closed on Monday, Independence Day. I expect the market to contiune to be choppy, but near term it feels like more upside is on the cards
I have updated the trading log here
Did quite a bit of adjustments to the S&P 500 emini structure as the move lower didn't happen.
Sold calls at 1340 and 1350 for August expiration, which basically means we need to see a move above the yearly high to make those positions lose money.
Good luck
Last Friday, the S&P 500 futures closed at 1262 and the world was looking terrible with all kinds of default and one week later everything is all good and we are less than 30 points off the yearly high. What a turn around.
We have the long weekend now with the US markets closed on Monday, Independence Day. I expect the market to contiune to be choppy, but near term it feels like more upside is on the cards
I have updated the trading log here
Did quite a bit of adjustments to the S&P 500 emini structure as the move lower didn't happen.
Sold calls at 1340 and 1350 for August expiration, which basically means we need to see a move above the yearly high to make those positions lose money.
Good luck
fredag 1. juli 2011
Market Report Friday 1st of July
see full pdf version here
Daily Market Report for Friday 1st of July 2011
Sign up to receive the daily report directly by email (fill out form at this page): http://avantagefinancial.ch/contact?avantagefinancial_ch=5b87a7ae083a034fb21f15a963ab7882
Follow our live trades at: http://twitter.com/AFtrading
Make sure to check out our blog as well: http://avantagefinancial.blogspot.com/
The quarter ended with a good move to the upside in the S&P 500 futures once again as we tend to see toward quarter end. The S&P 500 was basically flat for the quarter (-0,39%) and is up 5,01% for the year. We have now rallied just more than 50 points in the S&P 500 futures since Friday, not bad. It does looks overbought now and it will be interesting to see if it can continue the rally and take out that falling key resistance from the yearly high, which is coming in at 1317, see chart of the S&P 500 emini futures below how that trend line is clear resistance now. I favor a move back to the 1292 support over the next 3 sessions.
Corn had a huge move lower today following the USDA acreage report, which totally caught the market on the wrong foot. We had no limit in the July contract and it closed down by 69 cents, 9,9%. That is just nuts. http://www.bloomberg.com/news/2011-06-30/wheat-plunges-to-11-month-low-corn-drops-after-u-s-reports-acreage-gains.html
I am considering setting up a trade (options) looking for somewhat of a retracement of yesterday's drop, but I first want to see that corn can stabilize a bit and not continue the melt down. Will come back to that over the next few sessions over Twitter, where I publish my trades in real time.
Another chart I found pretty interesting is the Crude oil chart. We have a strong bounce off that 89.69 low last week up to test the key resistance at 96. However it failed 2 consecutive days to get above the 96 level and I now fancy a move lower back to the 92.90 support. Take a look at the chart below and you see that 96 is the key pivot level, with both a prior daily high and a falling resistance line in that region.
I am a bit surprised to see gold and silver performing so weak over the last few days. When we see risk bid gold and silver seems to be lagging and not able to get any real momentum. Looking at the chart it shows the reason. We have taken out the interim support and broken to the downside of the triangle that we have been trading inside for the last 2 months. Looks like we can test 1464 next.
A key factor can be that interest rates have moved up along the curve, making it less attractive to hold gold and silver as they are not generating any cash flow, so when the interest rates rises it becomes more attractive to hold Treasuries compared to Gold. Looking at the correlation between gold and US 10 year Treasury futures the prices are pretty correlated, meaning lower interest rates is bullish for gold and vice versa. But who really cares about the reason for moving lower? Price action is always the king.
Looking at a few interesting points in the markets trading wise:
- Key resistance 1317 in the S&P futures and I am looking for move back to 1292 support over the next 3 sessions.
- We have Independence Day in the US on Monday, meaning the US market is closed.
- Crude failed at 96 for the second consecutive day yesterday; expect a dip towards 92.90 support.
- Silver is approaching the lower end of the last month’s range, range 32.75 to 38.76.
- Gold has broken to the downside and looking for a test of the May low at 1464 next.
- Euro is looking overbought; I fancy a move back to the 55 exponential moving average at 1.4330 near term.
Today’s calendar:
15:55 US Michigan Sentiment
16:00 US Construction Spending
16:00 US ISM PMI
Over the weekend, the EU and IMF will meet to decide on the 5th loan tranche to Greece.
Interesting headlines:
State is now dominant force in US capital markets - The FT -
http://www.ft.com/intl/cms/s/0/638185f8-a303-11e0-a9a4-00144feabdc0.html#axzz1QQh2MtL3
Greece approves second part of controversial austerity bill - The Telegraph -
http://www.telegraph.co.uk/finance/financialcrisis/8609534/Greece-approves-second-part-of-controversial-austerity-bill.html
Emerging markets could be the new safe haven for investors - The Telegraph -
http://www.telegraph.co.uk/finance/economics/gilts/8606635/Emerging-markets-could-be-the-new-safe-haven-for-investors.html
German Banks Agree to Greek Aid Deal - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417252315650580.html?mod=WSJEurope_hpp_LEFTTopStories
Belgium: Give Greece More Money - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417752396628850.html?mod=WSJEUROPE_hps_LEFTTopWhatNews
Trichet Against Non-Voluntary 'Debt Action' - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417161986363634.html?mod=WSJEUROPE_hps_LEFTTopWhatNews
QE2′s Winners and Losers - The WSJ -
http://blogs.wsj.com/marketbeat/2011/06/30/qe2s-winners-and-losers/
Senate Democrats Invite Obama for Debt Talks - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417650015732130.html?mod=WSJEUROPE_hps_sections_news
A Case When Buying Time Worsens the Burden - The WSJ -
http://online.wsj.com/article/SB10001424052702304450604576417921818436698.html
Greece can be saved – here’s how to do it - The FT -
http://blogs.ft.com/the-a-list/2011/06/30/greece-can-be-saved-heres-how-to-do-it/#axzz1Qo3dyAOj
Geithner talks of quitting US Treasury - The FT -
http://www.ft.com/intl/cms/s/0/b7c0038a-a342-11e0-8d6d-00144feabdc0.html#axzz1QQh2MtL3
Japan’s Tankan Deteriorates to Worse-Than-Expected Minus 9 on Quake Impact - Bloomberg -
http://www.bloomberg.com/news/2011-06-30/japan-s-tankan-deteriorates-to-worse-than-expected-minus-9-on-quake-impact.html
Technical’s and comments
Euro: I expect the falling resistance to hold and a move back into the range, targeting the 55 EMA at 1,4330. Might be interesting to look at some downside option plays?
Cable: Looks like a better choice to short GBP than Euro at the moment as we have broken above the key resistance level at 0.90 in EURGBP. First upside level to get short I figures is around the 1.61 level and stop above 1.6150 or so.
USDJPY: Very tight range over the last sessions. I remain longer term bearish on the JPY as the fundamental factors in Japan looks ugly, with huge public debt and unfavorable demographics going forward. However the risk off over the last days has taken us below 80 again. Not sure if we see any intervention unless the move picks up in speed and magnitude. Buy on dips for the brave.
Swissy: Strong move higher in the EURCHF as we are once again above the 1.2250 level. Expect gains in the EURCHF to be much slower going forward. Given that I think we see a move lower in the S&P next it could be interesting to look at a downside play in USCHF near term. Have resistance at 0.85 at the moment.
AUDUSD: We have strong resistance around the 1.0750 level, so would not chase the price action above that level.
USDCAD: Rapid move lower and I think it makes sense to wait for a rally back up towards 0.9730 or to get short again.
S&P Future (ES): Ended yesterday higher as I expected, although a bit higher then I had anticipated. Have key falling resistance from the yearly highs coming in at 1317. Expect a move lower to 1292 support over the next 3 sessions.
Gold: Broken to the downside technically and next downside target is 1464. I would not go short at current levels as we have seen plenty of bounces in this region. If long I would prefer to use options or possibly long futures and sell some calls against the long futures to give a bit more flexibility.
Crude oil: Failed at 96 resistance for the 2nd consecutive day yesterday. I now look for a move down towards 92.90 support.
________________________________________
Risk Warning: Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by Avantage Financial GmbH with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Regardless of the account type you choose, there are risks inherent in trading, including the risk of loss greater than the original investment. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice. Prices can go down as well as up. Past performance is no guarantee of future results.
Daily Market Report for Friday 1st of July 2011
Sign up to receive the daily report directly by email (fill out form at this page): http://avantagefinancial.ch/contact?avantagefinancial_ch=5b87a7ae083a034fb21f15a963ab7882
Follow our live trades at: http://twitter.com/AFtrading
Make sure to check out our blog as well: http://avantagefinancial.blogspot.com/
The quarter ended with a good move to the upside in the S&P 500 futures once again as we tend to see toward quarter end. The S&P 500 was basically flat for the quarter (-0,39%) and is up 5,01% for the year. We have now rallied just more than 50 points in the S&P 500 futures since Friday, not bad. It does looks overbought now and it will be interesting to see if it can continue the rally and take out that falling key resistance from the yearly high, which is coming in at 1317, see chart of the S&P 500 emini futures below how that trend line is clear resistance now. I favor a move back to the 1292 support over the next 3 sessions.
Corn had a huge move lower today following the USDA acreage report, which totally caught the market on the wrong foot. We had no limit in the July contract and it closed down by 69 cents, 9,9%. That is just nuts. http://www.bloomberg.com/news/2011-06-30/wheat-plunges-to-11-month-low-corn-drops-after-u-s-reports-acreage-gains.html
I am considering setting up a trade (options) looking for somewhat of a retracement of yesterday's drop, but I first want to see that corn can stabilize a bit and not continue the melt down. Will come back to that over the next few sessions over Twitter, where I publish my trades in real time.
Another chart I found pretty interesting is the Crude oil chart. We have a strong bounce off that 89.69 low last week up to test the key resistance at 96. However it failed 2 consecutive days to get above the 96 level and I now fancy a move lower back to the 92.90 support. Take a look at the chart below and you see that 96 is the key pivot level, with both a prior daily high and a falling resistance line in that region.
I am a bit surprised to see gold and silver performing so weak over the last few days. When we see risk bid gold and silver seems to be lagging and not able to get any real momentum. Looking at the chart it shows the reason. We have taken out the interim support and broken to the downside of the triangle that we have been trading inside for the last 2 months. Looks like we can test 1464 next.
A key factor can be that interest rates have moved up along the curve, making it less attractive to hold gold and silver as they are not generating any cash flow, so when the interest rates rises it becomes more attractive to hold Treasuries compared to Gold. Looking at the correlation between gold and US 10 year Treasury futures the prices are pretty correlated, meaning lower interest rates is bullish for gold and vice versa. But who really cares about the reason for moving lower? Price action is always the king.
Looking at a few interesting points in the markets trading wise:
- Key resistance 1317 in the S&P futures and I am looking for move back to 1292 support over the next 3 sessions.
- We have Independence Day in the US on Monday, meaning the US market is closed.
- Crude failed at 96 for the second consecutive day yesterday; expect a dip towards 92.90 support.
- Silver is approaching the lower end of the last month’s range, range 32.75 to 38.76.
- Gold has broken to the downside and looking for a test of the May low at 1464 next.
- Euro is looking overbought; I fancy a move back to the 55 exponential moving average at 1.4330 near term.
Today’s calendar:
15:55 US Michigan Sentiment
16:00 US Construction Spending
16:00 US ISM PMI
Over the weekend, the EU and IMF will meet to decide on the 5th loan tranche to Greece.
Interesting headlines:
State is now dominant force in US capital markets - The FT -
http://www.ft.com/intl/cms/s/0/638185f8-a303-11e0-a9a4-00144feabdc0.html#axzz1QQh2MtL3
Greece approves second part of controversial austerity bill - The Telegraph -
http://www.telegraph.co.uk/finance/financialcrisis/8609534/Greece-approves-second-part-of-controversial-austerity-bill.html
Emerging markets could be the new safe haven for investors - The Telegraph -
http://www.telegraph.co.uk/finance/economics/gilts/8606635/Emerging-markets-could-be-the-new-safe-haven-for-investors.html
German Banks Agree to Greek Aid Deal - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417252315650580.html?mod=WSJEurope_hpp_LEFTTopStories
Belgium: Give Greece More Money - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417752396628850.html?mod=WSJEUROPE_hps_LEFTTopWhatNews
Trichet Against Non-Voluntary 'Debt Action' - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417161986363634.html?mod=WSJEUROPE_hps_LEFTTopWhatNews
QE2′s Winners and Losers - The WSJ -
http://blogs.wsj.com/marketbeat/2011/06/30/qe2s-winners-and-losers/
Senate Democrats Invite Obama for Debt Talks - The WSJ -
http://online.wsj.com/article/SB10001424052702304584004576417650015732130.html?mod=WSJEUROPE_hps_sections_news
A Case When Buying Time Worsens the Burden - The WSJ -
http://online.wsj.com/article/SB10001424052702304450604576417921818436698.html
Greece can be saved – here’s how to do it - The FT -
http://blogs.ft.com/the-a-list/2011/06/30/greece-can-be-saved-heres-how-to-do-it/#axzz1Qo3dyAOj
Geithner talks of quitting US Treasury - The FT -
http://www.ft.com/intl/cms/s/0/b7c0038a-a342-11e0-8d6d-00144feabdc0.html#axzz1QQh2MtL3
Japan’s Tankan Deteriorates to Worse-Than-Expected Minus 9 on Quake Impact - Bloomberg -
http://www.bloomberg.com/news/2011-06-30/japan-s-tankan-deteriorates-to-worse-than-expected-minus-9-on-quake-impact.html
Technical’s and comments
Euro: I expect the falling resistance to hold and a move back into the range, targeting the 55 EMA at 1,4330. Might be interesting to look at some downside option plays?
Cable: Looks like a better choice to short GBP than Euro at the moment as we have broken above the key resistance level at 0.90 in EURGBP. First upside level to get short I figures is around the 1.61 level and stop above 1.6150 or so.
USDJPY: Very tight range over the last sessions. I remain longer term bearish on the JPY as the fundamental factors in Japan looks ugly, with huge public debt and unfavorable demographics going forward. However the risk off over the last days has taken us below 80 again. Not sure if we see any intervention unless the move picks up in speed and magnitude. Buy on dips for the brave.
Swissy: Strong move higher in the EURCHF as we are once again above the 1.2250 level. Expect gains in the EURCHF to be much slower going forward. Given that I think we see a move lower in the S&P next it could be interesting to look at a downside play in USCHF near term. Have resistance at 0.85 at the moment.
AUDUSD: We have strong resistance around the 1.0750 level, so would not chase the price action above that level.
USDCAD: Rapid move lower and I think it makes sense to wait for a rally back up towards 0.9730 or to get short again.
S&P Future (ES): Ended yesterday higher as I expected, although a bit higher then I had anticipated. Have key falling resistance from the yearly highs coming in at 1317. Expect a move lower to 1292 support over the next 3 sessions.
Gold: Broken to the downside technically and next downside target is 1464. I would not go short at current levels as we have seen plenty of bounces in this region. If long I would prefer to use options or possibly long futures and sell some calls against the long futures to give a bit more flexibility.
Crude oil: Failed at 96 resistance for the 2nd consecutive day yesterday. I now look for a move down towards 92.90 support.
________________________________________
Risk Warning: Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by Avantage Financial GmbH with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Regardless of the account type you choose, there are risks inherent in trading, including the risk of loss greater than the original investment. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice. Prices can go down as well as up. Past performance is no guarantee of future results.
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