Last Tuesday (5/7) Australia’s Central Bank cut interest rate in a surprise move. The Reserve Bank of Australia (RBA) cut its cash rate to 2.75% according to The Wall Street Journal. Australian Dollar ETF (FXA) started trading down from $104 level after the news released and reached a low of $99.45 by Monday (5/13).
According to another report from The Wall Street Journal, the dollar rose above the ¥100 level on Thursday (5/9) for the first time in four years, capping a 16% surge this year, after the better-than-expected U.S. economic data sparked a broad rally in US dollars.
June US Dollar Index futures (DXM3) also moved higher during last week’s trading and probably will break this year’s high of 83.66 made on April 4th in the near future.
U.S. stock market also made a new high last week. Last Friday (5/10), S&P 500 Index (SPX) closed at 1633.7, which is at its all-time high level. According to the Briefing.com, S&P 500 Index (SPX), Dow Jones Industrial Average and Nasdaq Composite Index gained 1.2%, 1.0% and 1.7% respectively for the whole week (5/6 – 5/10).
May stock and index options will expire this Friday (5/17). I think we may possibly see some small correction towards the end of the week. 1610 to 1620 level may potentially provide some supports if any possible pull-back may happen. On Thursday (5/16) June crude oil options will expire as well. I think the June crude oil futures contact (CLM3) may probably settle near 95 level. June gold contract (GCM3) bounced off the 1480-level top and started moving down again at the end of last week. I think GCM3 may be likely to continue moving towards the 1400 level in the near term since it may possibly stay in the downtrend in the near future.
Please keep in mind that trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Consult with your own financial advisor before implementing any idea or strategy derived from this article. This communication is not a recommendation or a solicitation to trade. Past performance is not necessarily indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Past performance is not necessarily indicative of future results. There is unlimited risk of loss in selling options. An investor must read and understand the commodity trading advisor’s current disclosure document before investing.
Last Wednesday (5/1) the Federal Open Market Committee (FOMC) had its policy meeting and released its statement afterwards. According to The Wall Street Journal, the FOMC indicated in the statement that “The Committee is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes”. The same statement also addressed “the Fed said inflation was “running somewhat below” the central bank’s 2% goal and that the job market had “shown some improvement,”…The Fed has said it would keep the bond-buying programs going until it saw substantial gains in the job market.” The market was down since the market participants might likely feel disappointed by the fact that the Fed would possibly start considering pulling back on the bond purchasing program down the road. S&P 500 Index (SPX) opened at 1597.55 and closed at 1582.7 on that day (5/1).
Friday (5/3) U.S. Department of Labor released its April nonfarm payrolls number, which indicated that 165,000 jobs were created for that month and unemployment rate fell to 7.5%. S&P 500 Index (SPX) finally broke the 1600 level for the first time in history and closed at 1614.42 on Friday (5/3). Since SPX is in its all-time high territory, there doesn’t seem to be too much restriction on how high it may potentially go. Technically, I think 1580 to 1590 areas may probably provide initial support if there is any correction in the near future. On the upside, SPX may possibly test 1630 to 1640 area soon.
According to the Briefing.com, S&P 500 Index (SPX), Dow Jones Industrial Average and Nasdaq Composite Index gained 2%, 1.8% and 3% respectively for the whole week (4/29 – 5/3).
In the meantime, crude oil just went through some of the most volatile period of trading over the last several weeks. Since the beginning of April, June WTI crude oil contract (CLM3) went down from 97 level to 86 over a two-week period and went back to almost the same place near 97 level during the last two weeks. At this point I think the 98 to 100 area may possibly become the next resistance level and 90 area may likely become the near term support. This kind of back and forth movements within a short period of time might potentially be regarded as a nightmare for option writers.
June gold futures contract (GCM3) bounced between 1460 and 1480 for the whole week (4/29 – 5/3) and might still try to recover from the sell-off in mid-April. However it did not look like to have enough buying interests to push the gold price back above 1500. It looked to me that gold may probably stay in the down trend in the near term.
The economic calendar is light this week. I think the market may stay relatively calm in this week’s trading.
Please keep in mind that trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Consult with your own financial advisor before implementing any idea or strategy derived from this article. This communication is not a recommendation or a solicitation to trade. Past performance is not necessarily indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Past performance is not necessarily indicative of future results. There is unlimited risk of loss in selling options. An investor must read and understand the commodity trading advisor’s current disclosure document before investing.
Last week (4/22-4/26) U.S. market made a reversal and recovered majority of the losses from the week before. According to the Briefing.com, S&P 500 Index, Dow Jones Industrial Average and Nasdaq Composite Index were up 1.7%, 1.1% and 2.3% respectively.
I think the S&P 500 Index (SPX) demonstrated that it had successfully tested 1530 to 1540 area of support within a month. Now it may likely test the 1590 to 1600 area of resistance again in the near term. However, this week there are multiple major events in the market place which may possibly increase the volatility in the market. On Wednesday (5/1), the Federal Reserve will release its interest rate decision. ISM manufacturing index will also be released on that day. On Thursday (5/2) the European Central Bank (ECB) will also announce its interest rate decision. On Friday (5/3) U.S. April employment data and ISM nonmanufacturing data will be released as well.
Right now SPX may potentially be in a slightly overbought condition after the rally last week. Therefore there may probably have some pull-back in this week’s trading, in my opinion. I believe 1550 to 1560 area may possibly provide some strong support in the near term. As we enter into the month of May, it will be interesting to see if the traditional saying of “sell in May and go away” on the Wall Street will in fact materialize this year or whether it will be delayed until June.
Crude oil and gold prices also rebounded from the recent sell-off last week. June crude oil contracts (CLM3) rose from 87 level to as high as 93.87 on Thursday (4/25). According to The Wall Street Journal, Energy Information Agency (EIA) reported increase of 900,000 barrels of crude oil stock pile, less than the 1.2 million expected last week. EIA also reported gasoline demand increased 4.4% to 8.75 million barrels a day while its stock piles tumbled 3.9 million barrels a day. June gold futures contracts (GCM3) rose from 1400 level to as high as 1484.8 on Friday (4/26).
I think both commodities may possibly have room to grow in the near term. CLM3 may possibly have some resistance at 94 to 95 levels. If it can successfully break this level, it may possibly go back towards the 97 to 98 levels again soon. GCM3 may possibly try to get back to the 1500 to 1520 levels in the near term. This was the level where the recent sell-off was triggered once it was broken two weeks ago.
Please keep in mind that trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Consult with your own financial advisor before implementing any idea or strategy derived from this article. This communication is not a recommendation or a solicitation to trade. Past performance is not necessarily indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Past performance is not necessarily indicative of future results. There is unlimited risk of loss in selling options. An investor must read and understand the commodity trading advisor’s current disclosure document before investing.
Last Monday (4/15) the Boston Marathon bombing incident drove the market lower during the day. June S&P 500 Index futures (ESM3) opened at 1582.25 and closed at 1542.75, almost 40 points drop in one day. Last week’s pull-back was also the largest weekly drop for the year. According to the Briefing.com, S&P 500 Index, Dow Jones Industrial Average and Nasdaq Composite Index were down 2.1%, 2.1% and 2.7% respectively. This market drop drove up the volatility as well. S&P 500 volatility index (VIX) was as low as 11.99 on the Friday before (4/12). However on Monday (4/15) it shot up to as high as 17.27, more than 40% increase in one day.
S&P 500 Index (SPX) tested a low of 1536 last week, but held its 50-day moving average line near 1530 area. In the near term, I think SPX may possibly trade in side way between 1530 and 1570 until next break out may happen.
Crude oil also made a big move last week. June WTI crude futures contracts (CLM3) came down from 95 levels in the week before and traded as low as 85.9. However it looks to me that it may probably start building a base near 85 levels in the near term.
June gold futures (GCM3) traded as low as 1321.5 last Tuesday (4/16) and then gradually moved up. By Monday (4/22) it traded as high as 1438.8. I believe this is mainly a dead cat bounce after last week’s two-day sudden drop. It may possibly bounce back towards 1470 to 1500 level in the near future. However, gold is potentially in the longer term correction phase, in my opinion. Should the 1300 level break, it may possibly go down to 1100 levels.
This week the market will likely continue paying attention to corporate earnings. Apple will announce its quarterly earnings on Tuesday (4/23). Its stock price started its continuous decline from last September when it reached all-time high of 705.07. Right now it trades below $400. If there is more bad news from the earnings announcement on Tuesday (4/23), I think its stock price may probably continue its sliding towards $350 level.
Please keep in mind that trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Consult with your own financial advisor before implementing any idea or strategy derived from this article. This communication is not a recommendation or a solicitation to trade. Past performance is not necessarily indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Past performance is not necessarily indicative of future results. There is unlimited risk of loss in selling options. An investor must read and understand the commodity trading advisor’s current disclosure document before investing.
Last Wednesday (4/10) Goldman Sachs said that gold price could drop to $1450 a troy ounce by the end of this year and to $1270 by 2014, according to The Wall Street Journal. June deliverable gold futures contracts (GCM3) started declining from 1580 level on Wednesday (4/10) and traded near 1500 level by the end of Friday (4/12). On Sunday (4/14) evening when market opened, GCM3 continued moving lower and traded as low as 1422, which was already below the $1450 target price. During Monday’s (4/15) trading session, gold continued moving down and GCM3 traded as low as 1335.1.
Last week crude oil came down from 95 level again. On Sunday (4/14) evening, it continued sliding down and broke the 90 level. I think the next level of support may possibly be near 87. If that level may not hold, I think it may potentially drop to 80 level again.
Last Wednesday (4/10) the Federal Reserve released its last meeting’s minutes which indicated Federal Reserve officials actively engaged in a debate about whether to begin winding down an $85 billion per month bond-buying program after midyear, according to The Wall Street Journal. Some at the March meeting felt the Fed would be able to begin tapering the program down around midyear. Others saw the Fed continuing through September before tapering down, and a few wanted to keep the program going at its current pace through 2013 and into 2014. Some also held out the possibility of increasing the program if the economic outlook deteriorates. S&P500 Index (SPX) kept moving higher after the news was released and reached all-time high of 1597.35 on Thursday (4/11)
For the whole week (4/8-4/12), S&P 500 Index, Dow Jones Industrial Average and Nasdaq Composite Index were up 2.3%, 2.1%, 2.8% respectively, according to the Briefing.com.
Technically, SPX may probably have support near 1560 level and much stronger support will possibly exist between 1530 to 1540 levels. 1600 level may be likely to provide the near term resistance on the upside.
Please keep in mind that trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Consult with your own financial advisor before implementing any idea or strategy derived from this article. This communication is not a recommendation or a solicitation to trade. Past performance is not necessarily indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. There are no guarantees of profit no matter who is managing your money. Past performance is not necessarily indicative of future results. There is unlimited risk of loss in selling options. An investor must read and understand the commodity trading advisor’s current disclosure document before investing.
TRADING FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS AND IS NOT SUITABLE FOR ALL INVESTORS. THERE ARE NO GUARANTEES OF PROFIT NO MATTER WHO IS MANAGING YOUR MONEY. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. THERE IS UNLIMITED RISK OF LOSS IN SELLING OPTIONS. AN INVESTOR MUST READ AND UNDERSTAND THE COMMODITY TRADING ADVISOR'S CURRENT DISCLOSURE DOCUMENT BEFORE INVESTING.
