09August Another day of modest action and light volume. Initial risk-on style trading was abandoned in late action as it became apparent that the Draghi deal is not done and the optimism surrounding it is waning. We remain skeptical as long as no credible plan for inducing the Germans to pay for this are presented.
Some notable moves largely within the Ags, both U.S. and Exotic. The one continuing theme in Ags has been water; either too much or, as is most often lamented, too little.
Providio's Daily Futures Market Commentary for 8/9/12
Overbought Direction 0-100 Cocoa Rising 85 Heat Rising 83 RBOB Rising 82 Mini NASDAQ Falling 81 Canadian Rising 80 Cotton Falling 79 E-Mini SP Rising 76 CrudeOil Rising 74 Aussie Falling 74 Mini Dow Rising 73 Corn Rising 73 Oversold Direction 0-100 Sugar Falling 11 Two Year Falling 24 Bonds Falling 27 Ten Year Falling 29 Coffee Falling 31 Euro$ Falling 34
U.S. Economic Data releases-All times Eastern:
FOREIGN Economic Data releases-All times Eastern:
http://online.wsj.co...icCalendar.html THIS WEEK'S REPORTS:
Friday, August 10:
Import and Export Prices
Canada-Labour Force Survey
NEXT WEEK'S REPORTS:
Monday, August 13
US: -NO RELEASES
New Zealand-Retail Trade
Japan-BOJ MPB Minutes
Tuesday, August 14
NFIB Small Business Optimism Index
ISCS-Goldman Store Sales
Swiss-Producer and Import Price Index
Wednesday, August 15
MBA Mortgage Applications Index
Empire State Mfg Index
Industrial Production-Capacity Utilization
Housing Market Index
EIA Petroleum Status
UK-BOE MPC Minutes
UK-Labour Market Report
Thursday, August 16
Bloomberg Consumer Comfort Index
Philly Fed Survey
E-Commerce Rretail Sales
EIA Natural Gas Storage
Fed Balance Sheet
Friday, August 17
Futures Last Trade: Sep: 17Sep
Options Last Trade: Aug: 03Aug; Sep: 07Sep
09August Concerns in Europe over a worsening economic outlook have the Euro and other European currencies under pressure again. Slow bubbling up in economic outlooks in the Western hemisphere and Asia has the commodity currencies maintaining their rising bias.
Going back to the Draghi plan for European sovereign debt purchases. Again, who is going to pay for the bailout? All indications are the Germans. To this point, we've seen no plan that would lead us to believe this has been hammered out.
Support:1.0530: Rising trend line from 7June high.
1.0500: psychological resistance.
1.0488: 7/30 settlement
1.0437: 7/27 settlement
1.0400: psychological support
1.0390: 19July high.
1.0422: 27Apr high.
1.0325: Late April highs for September contract.
1.0358: 21-day moving average
1.0245: 200-day moving average
1.0125: 25July low.
1.0083: -2STD below 21-day moving average
0.9565: 01June low, traces back to support from last November.
1.0552: 8/6 high trade
1.0562: Trend Indicator
1.0564: 8/7 trade high
1.0600: psychological level
1.06326: +2STD above 21-day moving average.
1.0833: 29Feb high.
Comment: The pattern of higher highs and higher lows since 6/1/12 has been continuing. Our Trend Indicator remains as being supportive when the market has been rising and offered resistance when it's going sideways. This market is modestly Overbought, but getting more so. Secondaries ROC and RSI are rolling over indicating possible topping action. Look out below if this breaks as the recent action indicates it looks a bit overextended. A move all the way back down to the 1.0425 would not be out of the question.
Seasonal Snapshot (cash): The 15&19yr patterns fall out of bed throughout August. The 5yr weakens until 16Aug.
The pound stabilized when Mervyn King downplayed the chances for another rate-cut.
Support: 1.5608: 21-day moving average & just above psychological level
1.5500: Psychological level and support level since 6/13
1.5449: -2STD below 21-day moving average
1.5267: 01June low
1.5222 09Jan low
1.5179: Oct 2011 low
Resistance: 1.5700: psychological level
1.5736: 200-day moving average.
1.5773: 20June high & just above the 7/27 high (1.5767)
1.5767: +2STD above the 21-day moving average
1.5800: Psychological level and support from late March through mid-April. This is also near the 50% retracement of the late April thorough late May sell-off.
Comment: As we have noted, the wide consolidation that has been in place since May's losses has rendered our technical indicators lacking in directional predictability.
We continue to "nibble at the edges" since the currency seems to be stuck inside of a consolidation range, generally bound by +-2StD Bollinger Bands. We're out of the market right now. Volume remains anemic so far this week.
Seasonal Snapshot (cash): All three patterns are in a downward bias until 12Aug.
Another day of higher highs and higher lows leaves the bullish rally in place. Fifth straight day of gains as of this writing
Support: 1.0029: Trend indicator
1.0029: Daily high for 8/7 & just above 8/7 settlement (1.0026)
1.0016: 11May high.
1.0011: 8/3 high trade
1.0010: Upper boundary of rising channel in place since 01June.
1.0000: Psychological resistance
0.9915: 21-day moving average
0.9894: 200-day moving average.
0.9750: Lower boundary of rising channel in place since 01June
0.9752:-2STD below 21-day moving average
0.9554: 04June low
Resistance: 1.00779: +2STD above 21-day moving average.
1.0168: 27Apr high.
Comment: Since the near-term bottoming on 8/2, the Loonie has rallied relentlessly. Technicals clearly point higher. ROC and RSI both made the turn on 8/2 and are driving to m a more positive bias as well. RSI is Overbought at 79 and rising. Volume has been light, however.
The +2 STD over the 21-day moving average is acting as a brake on outsized gains.
Like the Aussie$, the Canadian has made three unsuccessful attempts to flip negative during this time period, but is further away from another turn this time around. Its upward Momentum has also been constrained by the +2 STD over the 21-day moving average.
Another day of probing to new highs as this market chugs higher.
Seasonal Snapshot (cash): All three patterns fall until 11Aug, then consolidate until the end of August.
Dollar Index: 09Aug
Support: 82.535: Trend indicator level (turning)
82.067: -2STD below the 21-day moving average
81.56: 29June low.
81.22: 18June low.
81.025: 21May low.
80.46: 200-day moving average
78.68: 30Apr low.
Resistance: 83.10: 21-day moving average
84.13: +2 STD above the 21-day moving average.
84.65: Rising trend line from the 09Jan high through 01June high.
85.30: Rising trend line from the Oct 2011 high (80.45) through the 13Jan high.
88.80: 07June 2010 high.
90.35: 38.2% retracement of the July 2001 to April 2008 decline. The market came close to this level twice: Mar 2009 (89.71) & June 2010 (88.80).
Comment: A modest rally back in risk-off reaction to poor European data.
Yesterday's action had another probe to new lows and probing to the -2STD below the 21-day moving average in midst of a consolidating day. Today we see a bounce but on Low Volume again. Momentum and Trend are pointed lower at this juncture. Secondaries show either a pause or bottoming.
There are still other open gaps to fill all the way down to 79.615 (04May).
Seasonal Snapshot: The 5yr's weakness until early Aug is much more pronounced than the 15&30yr's consolidation with a downward bias.
An ECB survey of economists has worse forecasts than previously shown. This has the Euro under pressure again. Since peaking off the residual strength from Friday's action, it has been under pressure.
1.2268: 21-day moving average
1.2050: 24July low.
1.2094: -2STD below 21-day moving average.
1.2000: Psychological level.
1.1874: June 2010 low.
1.1365: Falling trend line support back to 18Apr 2011 low.
Resistance: : 1.2300: psychological level
1.2335: 19July high and just below our Trend Indicator (1.2337)
1.2400: Psychological level
1.2417: 28June low.
1.2442: +2STD above 21-day moving average.
1.2750: 18June high.
1.2826: 21May high.
Comment: Since testing the +2 STD over the bottoming 21-day moving average starting last week, the Euro has held as resistance. This moving level has continues to act as resistance to further moves higher. The probe lower tests support at our rising Trend Indicator.
Again, keep risk controls tight. Moves have tended to lurch against the prevailing "trend".
Seasonal Snapshot: All three patterns head lower: 5yr until 18Aug; 15&30yr until 11Aug.
Support: 1.2700: 29June high.
1.2739: 21-day moving average.
1.2649: 200-day moving average.
1.2627: -2STD below the 21-day moving average
1.2435: 16May low
1.2415: 25June low
1.2233: 20Apr low
1.1879: 15Mar low
Resistance: 1.2788: Trend indicator level
1.2800: Achieved upside target for the ascending triangle formation. Psychological level
1.2852: +2STD above 21-day moving average.
1.2895: 01June high.
1.3145: Feb pre-intervention highs.
Comment: The 1.2800 level remains as the material overhead resistance. A modest falling pattern is in place with a series of lower highs and inconsistent lower lows. Today's action is within this overall context.
Every probe above the 1.2800 level in the past 2 weeks has been rejected as the market consolidates around and below level. Further outsized gains look to be constrained above the +2STD above the 21-day moving average.
The 21-day has crossed above the 200-day.
Currently, our trend indicator has rolled over to a clearly negative bias. Momentum has joined it, with the secondaries, ROC and RSI show acceleration possible.
Volume is still low.
Seasonal Snapshot: After a short downtick until 07Aug, all three patterns chug higher until late October.
Volume remains depressed.
Futures Last Trade: Sep: 21Aug; Oct: 20Sep; Nov: 22Oct; Dec: 16Nov
Options Last Trade: Sep: 16Aug; Oct: 17Sep; Nov: 17Oct; Dec: 13Nov
Support (continuous contract): 93.00: psychological level and just above 7/19 previous move higher settlement high
92.00: Trend Indicator level
90.00: psychological level near 21-day moving average (90.02)
89.90: 38.2% retracement of the March to June decline.
89.30: Late May consolidation lows.
87.45: 38.2% retracement of the July rally.
87.03: Early June consolidation highs
85.70: 50% retracement of the July rally.
83.65: 06-11July lows.
85.71: -2STD below 21-day moving average
80.68: 21-28June consolidation highs
77.28: 28June low.
77.28: 28June low.
75.71: 09Aug 2011 low
74.95: 04Oct 2011 low
Resistance (continuous contract):93.67: 8/7 recent move settlement high
94.34: +2STD above 21-day moving average.
93.85: 50% retracement of the March to June decline.
94.42: Current rally's high trade
97.28: 200-day moving average.
Comment: All our directional indicators point higher but secondaries indicate some slowing in the move may be at hand.
Our Volatility measure has eased back to Average from Very High levels and may reopen the door for option purchase strategies. This market's upward march is being capped by the +2 STD.
Seasonal Snapshot: (Cash contract) The 5yr falls until 24Aug. The 15&30year patterns consolidate until mid Sep.
Futures Last Trade: Aug: 31July; Sep: 31Aug; Oct: 28Sep; Nov: 31Oct; Dec:30Nov
Options Last Trade: Sep: 28Aug; Oct: 25Sep; Nov: 26Oct; Dec: 27 Nov
Modestly higher in action dominated by the above noted conflicting dynamics.
What happens to demand as the prices soar out in consumptionland? Action is largely dependent on Crude's direction, but there is vulnerability to refinery issues as the Summer driving season goes on and we approach the Autumn refinery production shift
Sep Support: 2.9650: Lower end of late April consolidation range.
2.9500: Psychological support level
2.9000: Psychological support level and dates back to early May's failure.
2.9945: +2STD above the 21-day moving average
2.8156: 21-day moving average.
2.8122: 200-day moving average.
2.6695: 38.2% retracement of the July rally.
2.6130: 50% retracement of the July rally.
2.5975: Lower end of early July consolidation range.
2.6208: -2 STD below the 21-day moving average
2.3737: 21June low.
Sep Resistance: 3.00: Psychological level
3.0105: +2 STD over the 21-day moving average
3.02: Upper end of late April consolidation range.
3.2065: 14Mar high.
Comment: Our Trend, Momentum, and RSI indicators have rebounded from earlier weakness and are all headed higher. ROC now looks to be rolling over.
Gasoline looks like it may be at the end of the second leg of a measured move higher. .If this is the case, the RBOB may be in for a short and sharp move lower.
Our Volatility measure is now in the high Average level, making them more attractive for purchase strategies. Look for the +2 STD to act as a drag on further gains.
Seasonal Snapshot: (Cash) The 5yr pattern falls modestly until 23Aug. The 15&30yr consolidate on wide fashion until mid Sep.
Sep Support: 2.8851: 21-day moving average.
2.7895: 05July high.
2.7875: 38.2% retracement of the July rally.
2.7350: 50% retracement of the July rally.
2.7050: 06-12July lows.
2.6495: 02July low.
2.7429: -2STD below the 21-day moving average.
2.5155: 25June low
Sep Resistance: 2.9505: 19July high.
3.0272: +2 STD above the 21-day moving average.
2.9784: 200-day moving average.
Like our other tracked Petro markets, all our directional indicators have gone positive in bias. The Heat's, however are more consistently positive.
Also, Volatility has dropped from very high levels.
The Sep contract has been supported above the rising 21-day moving average and remains above the flat lining 200-day moving average. Our Trend indicator, currently at 2.9785, has acted as support as well.
Seasonal Snapshot: (Cash) The 15&30year patterns strengthen until 04Aug, then fall along with the 5yr until mid Aug.
Futures Last Trade: Sep: 29Aug; Oct: 26Sep; Nov: 29Oct; Dec: 28Nov
Options last Trade: Sep: 28Aug; Oct: 25Sep; Nov: 26Oct; Dec: 27Nov
A lighter than expected injection caused a bid to emerge. A material move higher ensued.
Pay attention to forecasts as the shoulder season approaches. With economic activity seen as "picking up", NatGas is a beneficiary with its large role as an industrial feedstock.
Sep Support: 3.0001: 21-day moving average.
2.994: 200-day moving average
2.98: 27July low.
2.91: 5/18 peak high
2.89: 38.2% retracement of the June/July rally.
2.75: Psychological level.
2.72: 29June; 11; 12 & 17July lows.
2.745: -2STD below 21-day moving average.
2.53: 06June high. Old resistance/new support for the 15June low.
2.259: 12June low
2.222: 20Apr low
Sep Resistance: 3.257: +2STD above 21-day moving average
3.315: 38.2% retracement of the June 2011 to April 2012 decline.
4.10: Falling trend line back to Jan 2010 highs.
Comment: The negative bias, which looked pronounced as late as yesterday, looks to be easing.
ROC and RSI seem to indicate the shift is continuing. Our Trend Indicator seems to be bottoming. Volatility is falling, and is now only High.
Seasonal Snapshot: All three patterns turn higher until another leg down starts at the beginning of Aug.
Futures Last Trade: SP & NASDAQ: Sep: 20Sep; Dow: Sep: 21Sep
Options Last Trade: SP & NASDAQ: Aug: 17Aug; Sep: 20Sep; Dow: Aug: 17Aug; Sep: 21Sep
09Aug Equities show the same directionless dynamic with Eurozone risks running counter to the better U.S. releases.
Seasonal doldrums seem to be dominating the market's action.
Support: 1366.25: 21-day moving average.
1323.10: -2 STD below the 21-day moving average
1322.60: 200-day moving average
1321.25: 25July low.
1319.75: 12July low.
1302-1304: Double bottom 25June; 26June
1297: 12June low
1262: 04June low
Resistance: 1409.35: +2 STD over the 21-day moving average
1407: Rising trend line from 22May high.
1405: 01May high.
Support: 13075: 7/30 & 8/3 resistance
13000: Psychological level
12935: 19July high.
12917: 05July high.
12855: 21-day moving average
12572: Rising 200-day moving average.
12472: -2 STD below 21-day.
12425: 12July low.
12360-80: Quadruple bottom 13June; 25June; 26June; 28June
12288: 12June low
11985: 04June low
Resistance: 13239: +2STD above 21-day
13285: Rising trend line from the 22May high and 01May high
Support: 2621: 21-day moving average
2514: -2 STD below 21-day
2516.50: 12July low.
2523.75: 200-day moving average
2505: 12June low
2503.50: 28June low
2433.75: 04June low
Resistance: 2648: Upper end of the brief consolidation period after the early May peak.
2621.35 +2 STD above 21-day moving average
2732: Rising trend line from 22May high.
2753: 01May high.
Comment: Directional bias is positive. Secondaries ROC and RSI are showing a mixed bag depending on the market.
Look for a failure and move lower to higher lows in the next several days; this has been the pattern since the Doji bottom on 6/4.
We still see rallies as having been capped by their +2StD above the 21-day moving average.
At the risk of getting too "mumbo jumbo" and making little, if any sense, we note one interesting dynamic on the down moves. The rally off the 04June bottoming action has seen a pattern of higher highs and higher lows. Each decline off the higher high has found support in the neighborhood of the 50% retracement from the 04June low. This has forged those "higher lows" we have noticed. This tells us there may be a possibility for more declines (overnight?) to where those levels currently lie. This should be watched briefly, but closely:
easonal Snapshot: (Cash Indices) The 5&15yr patterns decline until mid August. The 30yr consolidates before turning very slightly higher on 09Aug.
Options Last Trade: Sep: 24Aug; Oct: 21Sep; Nov: 26Oct; Dec: 23Nov
09Aug Pre-USDA Report positioning had the recent shorts puking positions, and an attendant material rally. Especially the Soybeans. Few new positions as Volumes dropped.
As we said Tuesday, the fact is very little has changed and very little new is to be said. There's a drought , the crops have been materially damaged, high prices are killing some of the demand, and we're waiting to find out how bad the crops really are.
First Notice: Sep: 31Aug; Dec: 30Nov
Recent shorts were the likely source of today's material rally making new highs. A major directional move wasn't seen as likely before tomorrow's USDA Supply and Demand Report.
Field survey data will start impacting the supply side states.
The Sep/Dec backwardation has dissipated and the spread has now returned to a narrow Contango.
Support: 817¾: 7/30 high trade & just above the 8/8 high trade
8.00: Psychological resistance level and now support
7.90: Just above the 7/17 high
7.89: 21-day moving average
7.78: 7/16 high trade
7.60: Projected measured move. 6/15 to 6/27-6/29 pause, then 1.27 move from 6/29.
7.45-7.50: Psychological level
7.44: -2 STD under the 21-day moving average
7:08:7/5 settlement, 7/9 opening
7.00: psychological level
6.85-6.90: support above gap since 7/5 gap open.
6.73: Aug 2011 highs
6.56 ¾: 6/26 high trade
Resistance: 8.30: round number just above 8/9 high trade (8.29¾)
8.33½: +2 STD over the 21-day moving average
Comment: Directionals point to lower action, but most of our perceived action is consolidating as the market positions itself for this week's noted USDA report. The rally today takes some of the potential fuel out of any move higher if the USDA Report calls for it.
Watch our noted gap levels as these getting filled may give the market the structure necessary to head to new highs. Today's action took out a ½ cent gap between 7.49 and 7.49½.
Gaps remain in place between 6.74½ and 6.85½. Additional technical gaps remain between 5.94 and 5.96¼, between 5.54 and 5.70, and then well below the consolidation between 5.34 and 5.36 ¼.
Seasonal Snapshot: For December-All 3 patterns have a modest positive bias until 8/2. All 3 tend to general sideways action with various shorter-term biases, until 9/27. Then all 3 move sharply lower to bottom on 10/2, whereupon a generally positive bias will prevail until 10/14.
First Notice: Aug: 31July; Sep: 31Aug; Nov: 31Oct; Jan: 31Dec
The likely recent large short positions seemed to have headed for the exits before tomorrow morning's highly anticipated USDA report. Soybeans had the largest move off their highs with the hoped for rain. Positioning ahead of the report had the 'Beans up 50 cents at what point.
We maintain that U.S. Soybeans are going to find plenty of competition from Brazil at $15-$20.
Support: 16.16¼: 7/23 limit down and low trade
16.07: 7/17 high
1605½: 21-day moving average
16.00: psychological level and just below the 21-day moving average (16.00½)
15.98½: 7/16 high trade
15.90½: New settlement high on 7/16
15.75: 7/11 high trade
15.71¼: 7/9 high trade
15.70: support and resistance inflection point going back to 7/9
15.57: 7/9 early session resistance & support area going back to the 7/24 dump
15.50: psychological support, inflection point dating back to 7/9
15.25: 7/5 & 7/26 resistance and overnight support test on 7/9.
15.32: -2 STD under the 21-day moving average (16.05½)
15.00: Major psychological and round number price level, and measures to the $1.00 move higher from the previous high
14.50: Psychological level
Resistance: 16.34¾: 7/23 overnight support and near the declining Trend line drawn from the 7/23 high trade and reversal
16.51½: 7/23 overnight support and morning resistance level
16.79: +2 STD over the 21-day moving average (16.05½)
16.91: high trade from 7/20, just below the 7/23 overnight high
Comment: Our Primary directional technicals remain negative. The secondaries, though, made material moves higher as short covering dominated ahead of the Report.
As we noted yesterday, the bounce of the 1550s is off an area that sets up as a support and resistance inflection level. This is a good set up for a base to move higher with a descending wedge, which is a bullish formation as continuation after the moves we've seen. If this does play out, 'Beans may be setting up for another material move to new highs.
Some serious gaps remain below, most notably 14.74¾ to 14.93. If this gets filled and the drought action remains, this may set up the Soybeans for a move to materially higher record highs. However, that's an awful long way to fall.
Seasonal Snapshot: For November-All 3 patterns are in a modest but sharp positive mode until 8/2. They then enter a negative mode until bottoming action is complete on 8/10.
First Notice: Sep: 31Aug; Dec: 30Nov
Wheat has resumed trading in concert with Corn, largely sideways.
Support: 9.19-9.20:7/23 settlement, 9/24 & 9/25 high
9.17½: 7/18 high
9.12: 7/18 & 7/27 settlements area
9.05: 21-day moving average
9.01¾: 7/16 high trade
9.00: Psychological level
8.95: Support and resistance inflection point tracing back to late Jan 2011
8.70: late August 2011 resistance and 7/12 highs.
8.58¾: 7/9 high trade
8.50: Psychological resistance and -2 STD under the 21-day moving average
8.47: Settlement high on 7/5
8.41½: Resistance in late July and support in early September 2011
8.63: -2 STD under the 21-day moving average
8.15: mid-level support area from mid-July and mid-August 2011
8.00: psychological level and mid-Sep 2011 resistance.
7.80: 8/9/11 and 9/15/11 low support
7.66: 10/11 settlement, upper level of late October through early November rally
7.60: 6//25 high, near the 6/27 low
7.45: 5/21 high.
7.30: just above 5/21 settlement, general resistance area on rallies in early January and early February
7.17-7.20:Intermediate support and resistance inflection point, was support in mid-October, resistance in late December/early January, support in early February, and resistance on rallies in early and late March
7.00: Psychological level, extends on a traded level down to 6.90 and has acted as an inflection point around which lots of trading has occurred going back to December.
948¼: 7/20 high settlement
9.46¾:+2 STD over the 21-day moving average
953¼: 7/23 high trade
Comment: Wheat has been consolidating around and now above 9.00 level. This has been the case for the past 2+ weeks. It may be developing a triangle continuation, which would portend another material move higher.
This will likely end when the USD Report is released. General Primary negative bias has indications of positive bias developing.
Seasonal Snapshot: For December-All three patterns move higher until peaking on the 8/2. The 5-year drops for 1 day, then peaks on 8/5. It then drops hard until 8/8, then enters a volatile period of negative and positive biases until the end of August/beginning of September. It then enters into a generally negative bias until 10/7. The 15-year moves generally sideways until 9/10, where it enters a negative bias until 9/19. The 30-year moves sideways, with day-to-day volatility, until 9/12. It then falls sharply until bottoming on 9/19.
U.S. Treasurys' First Notice: Sep: 31Aug; Dec: 30Nov
U.S. Treasurys' Options Last Trade: Sep: 24Aug
09August Waning optimism regarding Europe's debt-purchase plan (the Draghi plan) coupled with 2 straight poor long-term Treasuries auctions had the Treasuries off their game and down. German debt was modestly higher off of safe haven trading in Europe. It should be noted that the weak action in the Treasuries auction was offset somewhat by risk-off sentiment related to Europe.
Again, we ask, what evidence do we have that the German's are seeing a plan that they will feel comfortable funding?
Bonds- Another poor auction in the 30-year took the longer term treasuries lower. Waning European optimism from the debt purchase plan brought them back from a more serious loss in late action.
Support: 148:00: psychological support level, was resistance from 5/17-5/24, and has been support since 6/7
147-24: 6/13, 6/20 support & 5/22, 5/25 resistance
147-00: Psychological level, 5/16 resistance, support area 5/1-5/29, 6/11.
Resistance: 148-07: 6/21 low, Support level from 6/13 & 6/15
148-16: Late May resistance
148-06:-2STD under the 21-day moving average (150-27)
149-03 support on 5/31, 6/6-6/8. 6/17, resistance 6/19 & 6/20
149-21: 6/21 high, settlements on 5/30 & 6/15
150-00: Big psychological level, resistance on 5/30 and 6/13
150-09: 6/5 support, 6/8 resistance, 6/18, 6/19 high trades
150-24: pattern resistance since 6/1-6/7 sell-off
150-27: 21-day moving average
151-00: psychological resistance & 21-day moving average
151-24: 6/4 intra-day support, 6/5 intra-day resistance
152-00: psychological resistance
152-03: 6/1 settlement high
152-19: 6/4 high trade
153-00: Psychological round number
153-01: 7/23 high trade
153-17: +2STD over the 21-day moving average (150-27)
Comment: Another negative day of lower lows and lower highs. Negative biases accelerated as late action losses ended with the day down again.
Volume rebounded to previous more notable levels.
Seasonal Snapshot: (cash contract)
Bonds: The 5yr pattern declines 7/1. It then bounces higher and lower, going generally sideways until 7/23, whereupon it enters a generally negative pattern until early October. The 15 & 30 yrs consolidate with a downward bias until August.
Tens (10-Yr Notes) Tens remain exhibiting similar action as Bonds, rebounding from early lows to end close to unchanged.
Support: 133-13: -2 STD under the 21-day moving average (134-17)
133-08: supported on 6/14, 6/17
132-28: near 6/13 & 6/20 lows, resistance in late May
132-16: 5/15 resistance, 5/2/ support, near midpoint to 5/17-5/25 consolidation action
Resistance: 133-17: intra-day chart high trades 6/11, 6/13, 6/17, 6/19, 6/20, 6/21
134-00: Psychological level. Support from 5/31-6/4, just above highs on 6/11, 6/15-6/19
134-20: high trades on 7/9 and 7/10, also traces back to intra-day support on 6/4.
134-17: 21-day moving average
134-25: 7/12 high trade and just above 6/1 & 6/2 highs
135-00: Psychological level
135-12: 7/23 high trade, and just above the 7/24 high as of this writing
135-17: +2 STD over the 21-day moving average (134-15)
Comment: Like the Bonds, Tens negative bias remains after Friday's action post-Payroll release.
Directionals all accelerated today lower with another probe to new lows today. Volume has rebounded. Look for major support down near 133-00
Seasonal Snapshot: (cash contract)
Tens: The 5yr pattern is in a modest bounce and fall off sideways pattern until 7/23, whereupon it enters a more profound falling pattern until early September. The longer-term patterns are in a modestly downward bias that accelerates toward the end of July and lasts until October.
Twos (2-Yr Notes)-Two's position as a safe-haven is under some modest pressure as the Eurozone tries to construct a rescue plan that will actually work and the Germans will actually help pay for...I mean pay for.
While we continue to maintain that Twos being allowed to fall is counter to current stated Fed monetary and QE policy, with the 6/20 news regarding the continuation of Operation Twist, some modest pressure on the short end is to be expected as the Fed reconfigures its balance sheet.
If the Fed decides it needs to break out the QE nukes again, we should see a lurch higher.
110-06.25: resistance on 5/30, support from 6/6-6/8, -2 STD under the 21-day moving average (110.08.75)
110-04.75: Declining trend line from 6/4 peak, resistance from 5/25-5/30
110-04: support from 5/29-6/19
110-03.5: resistance after 6/20 FOMC sell-off, support after 6/21 overnight rally
110-03: Support on 5/25, 6/20, & 6/21.
110-02: 6/20 low post-FOMC sell-off.
Resistance: 110-08: High settlement on 6/5
110-08.25: High Trade on 6/4
110-08.75: 21-day moving average
110-09.25: spike high trade on 4/24
110-09.5: 1/20/12 bounce low, late April, and early May high trades
110-11.25: resistance level dating back to 9/19/11
110-11.5:+2 STD over the 21-day moving average
110-12: high trades from August 2011 and mid-January 2012 &
110-14.5: high trades from late January 2012
Comment: It remains to be seen as to how much pressure the Fed will allow the two's to take. Dallas Fed's Richard Fisher took a bat to the U.S. Treasury Yield Curve when he said there is enough financial stimulus in the system.
All directionals point to lower action in a big sweeping shift in that direction. Violating the lows from last week today is a big deal. This still may set up the market for another push higher, but the bias is lower for now. This market, like most, ran into support at the -2 STD under the 21-day moving average. It traded down through that level then bounced back to it in late action.
Seasonal Snapshot: (cash contract)All three patterns move generally sideways until 7/29, when they all enter a longer term falling pattern until mid-September and early October.
Sept12 Eurodollar-We'll be shifting to the December contract soon.
Support: 99.585: -2 STD under the 21-day moving average (99.60)
99.570: 9/21/11 & 3/2 high trade
99.560: 2/3 and 3/2 highs and mid-August support
99.555: high trade on 6/20
99.535: high on 6/18 & 6/19, settlement on 6/20
99.525: Support level back to 6/20
99.510: major support and resistance level going back to 2/29 settlement. Major support low since 6/21. 99.500: high trade from 4/12-4/19 & 4/26-4/27, low from 5/1-5/4, settle on 5/7
99.490: high trades on 6/7 & 6/11
Resistance: 99.59-99.60: 7/11 high into Aug 2011 topping action and 99.59 inflection point.
99.60: 21-day moving average
99.62: +2 STD over the 21-day moving average (99.60)
99.635: just above Aug 2011 highs
Comment: Recent action has taken this market's directionals to a negative bias. Not an awful lot of real directional action is likely, though with the Central Banks not making many real moves at this point. Another day of anemic Volume.
Bunds (10-yr) Bunds bounced in action related to waning optimism over the Draghi plan for debt purchases. Like the U.S. Treasuries, safe-haven trading reemerged once this became apparent.
Serious support lies near the lows of 142.35.
Support: 142.16: -2 STD under the 21-day moving average (144.23)
142.45: 5/14 & 5/16 highs, support & resistance inflection 5/17-5/23
142.00: psychological level
141.50: general support and resistance inflection area since 6/13 lows.
140.00: resistance in late April and early May
143.45: late May resistance
144:00: psychological level and early June resistance
144.23: 21-day moving average
144.31: 7/9 high and 5/30 settlement
144.70-144.75: zone for 7/11 highs, and 6/5 lows. Above targets the June highs
144.85: 7/12 settlement
145.00: psychological level and near 7/12 high
145.40: Early June resistance level and settlement high
145.50: psychological level
146.30: +2 STD over the 21-day moving average (144.23)
146.00: Psychological level and just above the 6/1 high trade
146.25: just below 7/23 high, several hour area of testing of highs
Comment: Technically, Bunds negative bias remains despite today's modest rally. Volume is indecisive in supporting a move in either direction. The secondaries show possible bottoming in effect.
Schatz (2-yr): Unlike the U.S. Twos, the Schatz looks to be consolidating. Will this make for a more supportive environment if the ECB actually implements its asset buying plan?
However, we're uncertain as to this as a sustainable policy. If the ECB finally decides to institute a sovereign debt purchase policy, this may serve to undermine the Euro AND its denominated debt. With our previously stated view of, "Along with the U.S. Twos, the Schatz falling will end up being counter to official policy desires so we have our doubts as to any negative bias sustainability.", we feel therein lies a policy conundrum. This is likely to produce an unstable market and unstable indicators.
Support: 110.865: 7/12 high trade
110.86: 7/12 settlement high
110.84: 6/1 peak and high trade
110.800: Late May/Early June resistance
110.823: -2 STD under the 21-day moving average (110.892)
110.755: Late May/Early June chart pattern support from pattern lows
110.675: 6/8 settlement and level of declining trend line drawn from 6/6 high.
110.625: 6/25 high and 6/11 low
110-59: resistance zone in early April, support and resistance inflection in late April/early May, support on 6/6, resistance on 6/14 & 6/15
110.50: psychological level
110.445: support in early April.
110.355: resistance in late March/early April, at various times support or resistance going back to late December.
Resistance: 110.892: 21-day moving average
110.905: Just below 7/17 high trade, 7/16 high trade. 7/18 settlement
110.95: 7/23 high
111.00: psychological level
110.962: +2 STD over the 21-day moving average (110.89)
Comment: The Schatz's recent negative shift seems to be slowing and a more positive bias may follow. The Volume points to consolidation, but also supports the positive shift.
Options Last Trade: Sep: 28Aug; Oct: 25Sep; Nov: 25Oct
First Notice: Sep: 31Aug; Oct: 28Sep; Nov: 31Oct; Dec: 30Nov
1600: Psychological level.
1598.8: 21-day moving average.
1563.4: -2STD below the 21-day moving average.
1549: Rising trend line from 16May low.
1532: 30May low.
1529.3: 16May low.
1523.9: Horizontal trend line that extends back to the 26Sep lows.
1500: Psychological support
1478.3 to 1462.5: Cluster of lows between 02May & 27June.
1456.8: 38.2% retracement of the Oct 2008- Sep 2011 rally
Dec Resistance 1620.9: Trend indicator level
1634.1: +STD above 21-day moving average and late July highs.
1635: Mid June highs.
1642: 06June high.
1655.7: 200-day moving average
1675: 01May high.
1681: Mid April highs.
1682: Falling trend line resistance from the Sep 2011 high (1920.7).
Comment: Four straight days of light action and largely directionless trading indicates a market looking make a decision.
The +-2STD Bollinger Bands are expanding again, largely on the heels of Thursday's and Friday's material moves.
e remind readers of the giant descending triangle which extends back to the Sep 2011 high (1923.7). The upper boundary currently comes in at 1685. The bounce off our noted support level at the 26Dec low (1523.9) forms our horizontal trend line noted above and the lower boundary of the triangle. A sustained move below this larger descending triangle targets large losses to 1125.
Seasonal Snapshot: Wide consolidation with a very modest upward bias in all three patterns until September.
First Notice: Sep: 31Aug; Dec: 30Nov
Whatever positive sentiment coming from better US number ran smack into the reality of the European debt crisis drama. With apparent waning optimism for Draghi's plan setting in, early positive action, albeit, weak at best gave way and the market ended near unchanged.
The fact is, since falling to current levels in late-May, the market has gone largely sideways, trading around this area to various degrees.
Support (continuous): 3.4185: 21-day moving average.
3.3320: 25July low.
3.3105: -2STD below the 21-day moving average has acted as a brake. Also rising trend line from the 04June low through 22 June low.
3.2565: 22June low.
3.25: 15Dec 2011 low.
3.2380: 04June low
3.2040: 25Nov 2011 low
3.1930: Rising trend line from the June 2010 low (2.7200) through the Oct 2011 lows (299.40)
3.0915: 20Oct 2011 low
3.0500: Target for a break below recent symmetrical triangle formation
2.9940: 03Oct 2011 low
Resistance (continuous): 3.5280: The 38.2% retracement of the Feb to May decline and also clusters around the upper end of a brief consolidation range in late May.
3.5260: +2STD above 21-day moving average.
3.5565: 03July high.
3.5835: 200-day moving average
3.85: Target for break out above recent symmetrical triangle. Comment: The move higher has dragged the directional to a modestly positive bias. It's still vulnerable, but definitely shifting. The Volume supports the move. Is this poised for the breakout move we have been waiting for? Seasonal Snapshot: All three patterns are in a weak period until mid August.
Cocoa: First Notice:Sep: 20Aug; Dec:
Options Last Trade:Sep: 03Aug; Oct: 07Sep
Support:2412: Mid-January high and late March lower high.
2372: 07May high
2320: 200-day moving average
2314: Falling trend line from 27Jan high and the upper boundary of a symmetrical triangle.
2307: 21-day moving average
2195: Rising trend line back to 04June low and the lower boundary of a symmetrical triangle.
2160: 7/12-7/18 support
2115: -2 STD under the 21-day moving average
2080: Early April support.
2035 area: Major support. Horizontal trend line. 12/12/11 low and 6/1 and 6/4 low.
Resistance: 2480: just above the 8/8 & 8/9 highs
2499: +2 STD above the 21-day moving average
Comment: Another attempt to chug higher, but was unable to hold the gains. The higher Volume coupled with failure to make new highs or settle higher is worrisome.
It again ended off its highs. Still however, the ROC is not getting overextended. The RSI is getting more overextended, however.
Volatility remains low.
The +2 STD, again, has acted as resistance.
Seasonal Snapshot: All three patterns are in a negative pattern until bottoming in mid-August.
Coffee: First Notice:Sep: 23Aug; Dec: 21Nov
Options Last Trade: Sep: 10Aug; Oct: 14Sep
Anticipating the incoming Brazilian crop, Coffee took another beating.
Dry weather is allowing harvests to proceed quickly. It remains having failed to remain above the Spring lows.
Support: 165.90: -2STD below 21-day moving average
161.50: Major failure level with high trades and much lower settles on 6/5 & 6/20.
158.40: 6/19 & 6/21 settlements. Also, early June support before the move to the lows.
150.00: Psychological level and just below 18June low.
Resistance: 170.00: psychological support
171.75: Consolidation highs after 7-cent loss on 23May.
1.7300: Support zone in place since 7/24
174.25: Support region (+-0.50) dating back to 7/3
175.10: 09July low.
180.00: just above the 7/3 settle
177.85: 21-day moving average
182.00: Mid-level support and resistance inflection going back to 3/22
187.00: More important resistance going back to 3/12 support, serious resistance since 4/9.
189.80: +2STD above the 21-day moving average.
190.00: Psychological level and March-April inflection point.
192.20: 11July high.
195.55: 04Apr high.
200.55: 200-day moving average.
208.60: 38.2% retracement of the May 2011 to June 2012 decline.
Comment: Materially lower day as this market's recent declining channel continues to spell out lower prices. Secondaries added an accelerative push lower as they are rolling over negative.
The big issue was its recent failure to get and stay above 180.00. Hedging for delivery is likely to be a cash intensive business unless some sort of long option strategy is implemented. Call or email us for information on how to implement.
Seasonal Snapshot: All 3 patterns head higher into mid-August.
First Notice: Oct: 24Sep; Dec: 26Nov
Options Last Trade: Sep: 17Aug; Oct: 14Sep; Nov: 19Oct; Dec: 09Nov
Lack of action as the market is waiting for tomorrow's USDA WASDE Report.
The USDA S&D Report is being eagerly awaited in the agricultural community.
Dec Support: 75.75: Intraday support and resistance inflection level since 8/6
75.00: psychological level
74.80: 19&20June double top
74.50: Was support
until early May, inflection point in late May and just above mid-June settlement high.
73.50: Psychological resistance
72.75: Resistance level from 7/3-7/9.
72.43: 21-day moving average
70.50: 7/30 low
68.58: -2STD below the 21-day moving average
64.60: 04June low
Dec Resistance: 76.28: +2STD above 21-day moving average
83.25: Dec 2011 low.
89.50: Falling trend line from the June 2011 high.
Comment: A breakout above the last several months' sideways action is being attempted and succeeding so far. Maintaining prices above 75.00 will add to sentiment.
Technicals point higher, but are showing some deceleration before the USDA Report.
Seasonal Snapshot: All three patterns show consolidation ahead of weakness at the beginning of August.
First Notice: Oct: 01Oct
Options Last Trade: Sep: 15Aug; Oct: 17Sep
Another day of material losses sinceBrazil was able to resume normal harvest operations. Sugar has fallen relentlessly over 13%. Another day of the Sugar falling despite upward pressure in Energies.
Support: 20.50: Old resistance & where Sugar fell to & bounced for a short time in early May.
20.35: Rising trend line that extends back to the 04June low.
20.20: 6/11-6/15 inflection level, 6/22-6/25 support.
19.80: Late May support, early June inflection, mid-June support levels.
18.86: 04June low
Resistance: 20.94: -2STD below 21-day moving average (22.57)
21.00: Psychological level and near last week's highs.
21.15: June highs support
21.95: 50% retracement of the March to early June decline.
22.57 21-day moving average. Support in late November and mid-December
23.00: Psychological level and resistance since 7/10
23.05: week of 7/9 highs resistance
23.20: near 7/24 & 7/25 lows
23.28: 7/9-7/11 resistance.
24.21: +2STD above 21-day moving average (22.57).
24.00: Falling trend line resistance back to July 2010 high.
Comment: The previously noted Head and Shoulders would target the lows down pressuring the 19.00 level. Today's action takes the Oct below the mid-June failed breakout higher.
Volume was basically on pace with yesterday. All of our directionals are now pointed to lower action and another day's supply side rout keeps the pressure on.
All our directional indicators are firmly negatively biased. Quite Oversold & getting more so every day.
Seasonal Snapshot: All three patterns are in a pronounced upward bias until the beginning of Aug.
The information presented in this report is taken from sources we believe to be reliable and accurate. This information is not guaranteed as to accuracy or completeness. The opinions expressed are based on our best judgment at the time of writing and are subject to change without notice. These opinions should not be construed as an inducement or advice to enter into any Futures or Options on Futures transaction except where explicitly stated. There is risk of substantial loss in trading futures and options. One's financial suitability should be considered carefully before placing any trades. Past performance is not indicative of future results.
This post has been edited by ProvidioTradingCom: Aug 10 2012, 05:58 AM