Rare But Powerful Indicator

  • May 23, 2001
  • Marc Dupee

Notice that we have an unusually high number of
Market
Bias Indicators, suggesting today’s move in stock index futures. Any three of these
signals pointing in the same direction provide a strong suggestion we could move
in a certain direction. Today we have seven indicators pointing down, an unusually high
number and a rare occurrence. Nasdaq 100 futures
(
NDM1 |
Quote |
Chart |
News |
PowerRating),
S&P futures
(
SPM1 |
Quote |
Chart |
News |
PowerRating) and Dow futures
(
DJM1 |
Quote |
Chart |
News |
PowerRating) are all
lower. 

T-bonds
(
USM1 |
Quote |
Chart |
News |
PowerRating) gapped lower, rallied to test yesterday’s inside-day
high and have since traded back toward session lows, triggering its Pullback From Lows
setup below yesterday’s low. The outside-day down and tail that bonds are
tracing are indicative of additional follow through south. 

Lower-than-expected growth in Europe’s two largest
economies, Germany and France, is continuing to have a negative impact on
euro FX futures
(
ECM1 |
Quote |
Chart |
News |
PowerRating). Both the ECM1 and
Swiss francs
(
SFM1 |
Quote |
Chart |
News |
PowerRating) are trading at a year-to-date low and are on the Implosion-5 List. 

From the momentum indicating
New 10-Day Highs List, June dollar index futures
(
DXM1 |
Quote |
Chart |
News |
PowerRating) are the
primary beneficiaries of the decline in European currency futures and are
trading at a contract high. 

Following through for a second day on its Turtle Soup
Plus One Sell setup, copper
(
HGM1 |
Quote |
Chart |
News |
PowerRating) is
down and filled Monday’s gap. The upside momentum evidenced by unfilled gaps off
the recent low are suggestive that this contract will continue higher. A
seven-year low in interest rates and the belief that the economy will rebound
are fundamental factors underpinning copper’s potential advance. 

In the energies, heating oil
(
HOM1 |
Quote |
Chart |
News |
PowerRating) has
inched steadily higher out of the handle of its cup and handle. Its current
outside bar near its spike high from last October suggests follow through.
Heating oil also appeared on the 6/100 Low Volatility
List, hinting that a large move could soon be in store for this contract as
volatility reverts to its norm. 

Cotton
(
CTN1 |
Quote |
Chart |
News |
PowerRating),
from the Implosion-5 List,
is continuing to fresh contract lows on favorable weather in Texas and the
South.