Stock and economic growth sensitive markets were lower last night after Chinese Finance Minister Lou Jiwei said that growth in China faces downward pressure and that there won’t be major changes in policy in response to individual economic indicators. The weekend G-20 meeting added to the nerves as the communique started: “We are mindful of the potential for a build-up of excessive risk in financial markets, particularly in an environment of low interest rates and low asset price volatility. We welcome the stronger economic conditions in some key countries, although growth in the global economy is uneven.” For economic data we get August existing home sales at 9 AM CT; they are forecast to come in at 5.18 million units which would be a gain of 1.1% y/y. Warmer weather pressured the grain markets as it will help aid crop development and dry corn for harvest.
Dec. eMini S&P Futures: By the Taylor Trading Technique we would anticipate a Buy day, although Friday’s doji added a question mark. The Buy day reference price would be 1998.25, and there is Fibonacci retracement support at 1991.25.
Dec. eMini Russell Futures: It’s a “cover breakout sales” day so a TTT Buy day is anticipated. Buy day reference prices would be 1134.30 (16 Sept. low) and 1136.20 (Friday low). Don’t buy until we see upside momentum.
Dec. T Bonds: It’s an “exit breakout buys” day so a TTT Sell Short day is anticipated. Reference prices are 136-26 and 136-24. Last night’s high of 137-06 was at the 20 day EMA.
Dec. Yen: Friday was a doji, the daily trend is down and ROC is on a sell signal- I would consider selling on a break of the session low of 9171.
Dec. Euro: TTT Buy day; it rallied off a gap (one tick, but still) lower open. 1.2886 is the first rally objective. Conservative traders could wait for a rally to short it.
Dec. British Pound: TTT Buy day; the selloff held Fib support at 1.6277. First resistance is at 1.6360 (20 day EMA).
Dec. Gold: TTT Buy day. The reference price is 1214.20 and first resistance is 1219.80. The longer term trend is down; don’t get married to the long side.
March Sugar: Breakout setup (doji, range contraction). A downside breakout was stopped this morning; can it rally now? Upside reference prices would be 15.86 and then 15.95.
Nov. Crude Oil: Breakout setup (NR7); watch the overnight low of 91.10 as the reference price for a downside breakout.
Nov. Natural Gas: TTT Buy day. Friday’s low of 3.899 is the reference price; the 3.965 area is the first objective for a rally. The longer term trend is down- don’t overstay the long side.
Nov. Soybeans: It’s due for a TTT Buy day however we don’t want to go long until we see upside momentum. Maybe we’ll see a rally when the day session gets going- watch the overnight low at 941-0. Even though it looks “cheap” longer term, don’t use that as an excuse for trying to pick a bottom.
Dec. Bean Oil: TTT Buy day. I had liked the long side although the past couple of days ended that. For today I’d watch the overnight low of 32.08 as the Buy day reference price.
Essential Guide for Futures Swing Trading
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