S&P 500 Emini Day Trading Gap Tuesday January 26, 2010

                              S&P 500 Emini Futures Day Trading THE GAP

S&P 500 Emini Day Trading Gap Tuesday January 26, 2010

S&P Emini 500 Futures opened up 9.75 points this morning.  Pricing dipped down within 1.75 points of filling the gap, but never got down to Friday's 1088.00 close.  Action on the day was inside yesterday's range and came in on lower volume.  Pricing came within 2 ticks of testing the 1100 level before failing towards the lower end of today's narrow 9.75 point range.  More important earnings reports remain this week, and traders seem to be in a wait and see mode.  Prices need to break through the 1100 resistance on volume before the current four day downtrend can be broken.

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Forex day trading Jan 25 US open EURUSD

The Asian equity markets have started this week lower as risk aversion continues to dog the financial markets. The dollar had been hurt last week by news that the Senate might not confirm Ben Bernanke's position before the end of his first term on 31 Jan; unsettling a market already fragile from last week's Obama speech. However subsequent support has begun to flow in from various senators including the Republican leader, soothing concerns for now. With very little on the data calendar, we expect EURUSD to remain range bound for now between 1.4030 and 1.4220. The BoJ have begun their latest two-day meeting today, and whilst there is not expected to be any change to interest rates, it will be interesting to gauge the reaction to last week's dip in USDJPY below 90.00 (revisited again this morning in early trading). Recently appointed Finance Minister Kan previously stated his preferred range for USDJPY was 90-95; but has since sought to distance himself from the remarks by stating in parliament that markets decide FX rates for themselves. Now, the focus will be on whether the BoJ have any stronger sentiments about the possibility of intervening at these levels. In Australia, Q4 PPI data came out lower than expected, dropping -1.5% YoY against estimates for a -0.9% reading. This is likely to adjust market expectations for CPI inflation in the coming months, and may lend support to the idea that the RBA may pause after the next 25bp hike (expected at the next meeting on 2nd Feb). Nevertheless, AUDUSD has held up relatively well, currently trading around 0.9050. Meanwhile, the SNB's Hildebrand was quoted in the Wall Street Journal on Friday; warning that the SNB would 'resolutely' prevent 'excessive' gains in the CHF as long as deflation risks persist. He also suggested there were residual risks of deflation in Switzerland despite CPI turning positive over recent months, implying further intervention could be possible. Today's data calendar is ligh [...]

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S&P 500 Emini Day Trading Gap Monday January 25, 2010

                                S&P 500 Emini Futures Day Trading THE GAP

S&P 500 Emini Day Trading Gap Monday January 25, 2010

S&P Emini 500 Futures had another convincing distribution day on Friday.  Volume was more than double the average at 3.54 million contracts, and the range was very deep to the downside.  All signs that the rally from March 2009 may be in for a correction.  After three high volume down days in a row, however, look for a bounce in the short term.  A spike to the 115 level over the next couple of days, with a break below 1085 may be a signal that the correction is for real.  Friday's action filled two open gaps that had been underneath the market price levels for awhile.  The open gap from the Monday December 21 close of 1108.75, and the open gap from the Friday December 18 close of 1098.25, both filled on Friday.  High volume tests to the downside have occurred twice in the rally, once in summer of last year and once again in the fall.  Both times the test has been overcome to the upside.  Action on the moving averages for this downside test seem to indicate a more serious challenge to the downside.

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Forex trading - US equities will give direction

Risk appetite is still lurching lower after yesterday's speech by US President Barack Obama that outlined dramatic reforms of the banking system; most notably the proposal to limit the extent banks can engage in proprietary trading and prevent banks from investing in hedge funds and private companies. Confusion is still rife as to how the definition of proprietary trading will be applied, and whether some of the largest financial institutions in the US will now face break-up to separate their commercial and investment activities, but investors reacted emphatically with an aggressive equity sell-off that saw $30bn wiped off America's top shares in two minutes. EURJPY plunged from 129.50 levels before the news to overnight lows of 126.56 – the strongest level of the JPY seen in over 9 months. Overnight, Asian indices have joined the equity market rout, with the Nikkei down over 2.5% and the Hang Seng down around 1.5%, with the misery compounded by renewed fears that China is moving towards tighter monetary policy. The flight to safe-haven assets such as the JPY will be an unwelcome development for newly appointed Japanese Finance Minister Naoto Kan who will now have his resolve tested after being quoted as favouring USDJPY in a range of 90 to 95. USDJPY has already dipped to lows of 89.79 in overnight trading, and if it falls further it is likely to dent Kan's credibility and prompt a scramble to verbally intervene and weaken the JPY. Meanwhile, Greek Finance Minister Papaconstantinou denied speculation Greece would require aid in its mission to handle the current budget concerns, stating "We are not expecting anyone to come to our rescue. Greece has not asked for it, not is it expecting anything of that sort". This followed an IMF spokesperson that was quoted yesterday as saying there was no expectation for Greece to request financial help from the IMF, appeasing concerns of sovereign default for the time being. EURUSD has recovered from its 1.4028 lows t [...]

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S&P 500 Emini Day Trading Gap Friday January 22, 2010

S&P 500 Emini Futures Day Trading THE GAP

S&P 500 Emini Day Trading Gap Friday January 22, 2010

S&P Emini 500 Futures had no gap today, but had  a big drop on huge volume.  The price drop was a convincing bearish move, that came within a tick of filling the open gap from the Thursday, December 31 close of 1110.50.  That's close enough to call the gap filled.  All indications point to further downward movement in the index.  Volume on the day was a robust 3.4 million contracts, and the range was more than double the 14 day average true range at 27.5 points deep.  The close came at the low end of the range, indicating a further decline is possible if the index breaks the 1110.50 level in the morning.  If positive earnings reports come from GOOG, some of the prominent financial companies this evening, or from GE tomorrow pre market, the index could bounce before resuming any correction to the down side.  A good measure of how far down a possible correction my go can be gleaned from the open gaps beneath the current prices.  The lowest lies at 902.00 from last July.  That's a big drop from here, but 10 months of upward market movement can be erased relatively quickly.

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Forex trading EURUSD sells as republicans win Mass. US equities head lower.

The JPY has weakened markedly overnight after strong Chinese continued to suggest robust economic conditions prevail. China's Real GDP in Q4 was an astonishing annualized rate of 10.7% (10.5% expected) and there were upward revisions to the Q3 data from 8.9% YoY to 9.1%. In addition, Retail Sales surged to 17.5% YoY (16.3% expected), and CPI jumped to 1.9% YoY from 0.6% levels seen last month. So far, USDJPY has traded up to 91.66 highs as the data soothed some of the effects of recent bouts of risk aversion. Nevertheless, considerable concerns are still weighing on the market's sentiment and keeping the USD elevated. Yesterday's earnings releases failed to inspire, with Morgan Stanley missing estimates by a significant margin (profits of 14 cents per share against expectations for 41.5 cents per share), dragging US equities lower. The USD has also been boosted by a Republican victory in the election for the Massachusetts senator vacancy; the win means that the Democrats no longer have the 60 votes required to automatically pass their healthcare bill, and indeed the prospect of political stalemate reduces the likelihood of further fiscal stimulus (stimulus that would likely weigh on the USD). The high demand for USDs has left NZDUSD still languishing around 0.7200 levels (after falling over 2.5% yesterday post-CPI) despite better than expected Retail Sales data overnight which came out at 0.8% MoM (consensus 0.5%). One of the main events of the coming session will be the release of the BoC Monetary Policy Report, followed up with the usual press conference with central bank Governor Carney. Yesterday's CPI was a subdued -0.3% MoM (vs. consensus -0.1%), a release that has reduced the odds that the BoC will cast off its conditional rate pledge before the end of Q2. The data pushed USDCAD to test major resistance at 1.0500 (1.0493 the high), and we remain vigilant of Governor Carney repeated any mentions of currency intervention in his press conference whic [...]

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Forex trading - dollar still stengthening against Euro Jan 21

Forex day trading -

The yen fell after a report from China showed economic growth accelerated to the fastest pace since 2007, damping demand for Japan's currency as a haven. The yen dropped the most against the Australian dollar among the 16 major currencies on speculation Japan's central bank will keep interest rates close to zero as the economy struggles to gain momentum. The yen slipped to 83.44 per Australian dollar as of 7:57 a.m. in London from 83.04 in New York yesterday. It depreciated to 128.95 per euro from 128.68, and was at 91.52 per dollar from 91.24.

The euro was near the weakest in five months against the dollar after the cost to protect Greek bonds from default reached a record. The euro traded at $1.4088 versus the dollar from $1.4106 yesterday, after earlier dropping to $1.4068, the lowest since Aug. 18. Gold declined for a second day in London, falling to the lowest in more than two weeks, as a stronger dollar curbed demand for the metal as an alternative investment. Gold for immediate delivery fell $5.10, or 0.5 percent, to $1,105.95 an ounce at 9:43 a.m. local time, the lowest since Jan. 4. The metal dropped 2.4 percent yesterday. Bullion for February delivery was 0.7 percent lower at $1,105.30 on the New York Mercantile Exchange's Comex division.

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