Commodity TRADING SCHOOL
COMMODITY TRADING SCHOOL FUTURES MARKET SUMMARY 08/03/09
SUMMARY OF DATA 08/04/09
8:30 AM US PERSONAL INCOME & OUTLAYS (PI -1.1% CS 0.3%)
10:00 AM: PENDING HOME SALES INDEX.
08/03/09 SUMMARY OF DATA
US ISM MANUFACTORING INDEX (48.9 VS. 46.5)
US CONSTRUCTION SPENDING (0.3% VS -0.5% Y/Y -10.2% VS -11.6%)
US DEBT MARKETS RETREAT AS DATA CONTINUES TO POINT TOWARD RECESSION PRESSURES SUBSIDING,
US TREASURIES fell from Friday’s late session rally after data reports on US manufacturing and construction spending came in better than analyst forecasts. Equities and Commodities rallied as risk tolerance skyrocketed, fueling the pullback in US Treasuries as low yielding, secure instruments lost their appeal. The fall of the low yielding US Dollar also contributed to the exodus from Treasuries, as returns from dollar denominated fixed income eroded against higher yielding and commodity based currencies.
In addition, Treasuries are coming up against standard supply concerns ahead of the announcements for Treasury auctions of US 3, 10, and 30 year debt for next week. Despite the mounting pressure on Treasury prices, many traders and analysts expect the markets to remain in a defined range in the foreseeable future, as reports show that many of the financial institutions that received TARP fund support are stepping up to purchase Treasuries. This is not being done out of charity though, as stability in the markets is offering some support to build portfolios with range bound Treasuries as a foundation.
Equities began August on a strong positive note, with the S&P closing above 1000 for the first time since November on stronger than expected reading for construction and manufacturing data, as well as strong profit readings from Barclays bank, HSBC, and Ford. Sentiment appears to be growing that the global recession cycle may have reached a strong support level, as few surprises appear possible for the marketplace to offer in the wake of worldwide global stimulus.
Traders and investors should remain prepared for a slowdown in gains though as the positive sentiment for equities may find significant bumps in the road ahead, as memories remain strong that equity holders are the last in line regarding support if the economy pulls back. It would be likely that support for equities will remain fickle and confidence for long term holding will not have the same level of support it once had anytime soon.
TECHNICAL OUTLOOK-US 30 YEARS- SEPTEMBER US 30 YEAR TREASURIES failed at a 38.2 Fibonacci retracement level at 119-130, setting the stage for the markets initial pullback. New level of initial resistance sets up at 118-270. Further downward momentum should be limited to initial support at 117-010. Market appears to be setting stage for a narrowing channel that offers little sign of a breakout in the near term.
S&P 500- S&P 500 futures technicals offer a diverse picture that suggest recent upward surges may have additional upward momentum to test, before settling into a range for the remainder August and September. Daily RSI and MACD suggest the market may be nearing a near term top. Resistance could be tested in the next few sessions at 1015.0 before staging a pullback that should find strong support at 976.00.
|
US DEBT FUTURES |
OPEN |
HIGH |
LOW |
CHANGE |
|
|
US U9 (US 30 YRS) |
119-030 |
119-035 |
117-080 |
117-190 |
-1 13.5/32nds |
|
TY U9 (US 10 YRS) |
117-110 |
117-110 |
115-270 |
116-060 |
-1 03.0/32nds |
|
ED Z9 (EURO $) |
99.290 |
99.310 |
99.250 |
99.265 |
-2.50 |
|
SP U9 (S&P 500) |
945.00 |
956.50 |
944.50 |
949.40 |
-4.00 |
Prepared by Rich Roscelli & Paul Brittain.
EMAIL QUESTIONS OR COMMENTS TO RICH@BINVSTGRP.COM
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Commodity Trading School, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
