September Dow Jones –Long from 8620 – The Dow Jones futures are trading above 9,000 for the first time since the beginning of January. The rally was triggered by a jump in home sales that helped ease investors’ worries about one of the economy’s biggest trouble spots. Better–than-expected results from Ebay, Ford and AT&T helped add fuel to the rally. Hold the long position and move the protective stop to 8930.
September Japanese yen – A new high was reached on July 13th when it reached 1.0909, taking out the high of 1.0904 on July 8. This was a swing pattern failure when the Yen failed to continue to trade higher after the initial breakout, but instead, it reversed and began to trade lower over the next five days into (C) before rebounding and forming a secondary high at (D). The rebound fell short of reaching the sell window at 1.0767 to confirm a swing strategy TR pattern, but instead dropped below the (C) swing pivot point to trigger a sell at 1.0554.Use any bounce above 1.0514 to enter a short position, with a protective stop above 1.0695.
September Eurocurrency – The dollar traded near a six-week low versus the euro, as investors continue to move away from the dollar. According to Citigroup Inc., the U.S. dollar may also continue to weaken against the yen and the Australian dollar, as global sentiment turns against the greenback. Monday’s strong performance pushed the market above the previous pivot high and out of the consolidation pattern it has been stuck in for the past several weeks. While this is a bullish continuation signal, I would prefer to see a retest of the breakout and a confirming pattern before making an entry recommendation.
October Sugar – Long from 17.97 –Sugar futures rose for a fourth day, extending the current rally to the highest in more than three years, on concern that global supplies will tighten further, as Brazil fails to make up for a production deficit in India.Hold the long position and move the protective stop to 1785, with 1865 as the target.
September T-Bonds – Rumors have been circulating for months that China would begin to put its massive currency reserves into other outside investments and move away from purchasing U.S. Treasuries. It seems there was some truth to the rumors.Beijing is saying it will use some of its $2.1 trillion in currency reserves, the largest in the world, to expedite Chinese companies’ expansion and purchases overseas, Prime Minister Wen Jiabao told diplomats, according to the Financial Times. “We should hasten the implementation of our ‘going out’ strategy and combine the utilization of foreign exchange reserves with the ‘going out’ of our enterprises,” he said.
“Going out” means China will increase purchases of investments and acquisitions overseas and lessen its dependence on the dollar. Instead of accumulating foreign exchange reserves and short-term financial assets, the government wants the nation to accumulate more long-term corporate real assets.” Returns on U.S. Treasuries will have to increase for them to remain attractive to China. My technical analysis reveals T-Bonds completed a 5-wave continuation pattern on July 8; T-Bonds retraced 60% of the price move between June 11 and July 8. T-Bonds bounced off the support and have posted two consecutive higher closes, with Tuesday’s close right at the 20-day MA. This is a potential swing trade strategy TR pattern, but Bonds failed to reach the major sell window at 118-30 for the early entry. However, the Bonds did close sharply lower and are ready to test the115-13 trigger price for a sell signal.Sell T-Bonds at 115-12 stop, with the protective stop at 117-28. A confirmation would project a drop to 111-15 into the next swing trade date (reversal day) due on 8/5
