Monday’s Futures Setups
The Standard &
Poor’s 500 futures rose, heading toward its fifth week of gains in
six. After starting off weaker in early trade and chopping around most
of the session, S&P futures got a boost from Citigroup (C),
which sparked an afternoon rally amid speculation that regulators and
securities firms are nearing a settlement on conflict-of-interest
charges.
Even though the S&P 500 Index ($SPX.X)
has rallied 16% since its five-year low on Oct. 9, it’s still down 21%
this year and is set to record its third year of losses.
The Dec. Nasdaq 100 futures (NDZ2)
also rallied at the end of the day, shaking off bad news about the
downgrade from Merrill Lynch on Intel (INTC).
The NDZ2 closed at 1065, up 13.50 or 1.28%.
In the chart above, Dec. lean
hogs (LHZ2)
are beginning to rally from a pullback from the high. We will look for
a break above the 47.00 area for another leg up. On
the TradingMarkets.com
Trend Matrix LHZ2 has Green Arrows for the Intermediate and
Long Term Trend. LHZ2 also has an up trending ADX
of 35. Lean hogs closed at 45.75, up 1.10 or 2.46%.
Possible
short candidates:
| Contract |
Setup |
Direction |
Trigger |
| Dec. corn (CZ2) |
Pull-back from the lows |
down | break below 2.39 |
| Dec. dollar (DXZ2) |
Pull-back from the lows |
down | break below 105.00 |
Yesterday the Dec. 30
year bond triggered a sell on a break below its 111′ 30 trigger.
It closed just above its 50% retracement zone. Last night we said a
break below this level could see USZ2 falling to the 110.10 area.
Today USZ2 got close to the 110.10 area hitting a low of 110.18. A
break below the 110 ’00 zone could lead to a drop to 109 ’00.
Possible
long candidates:
|
Contract |
Setup |
Direction |
Trigger |
| Jan soybeans (SF3) |
Pull-back from the high |
up | break above 5.70 |
| Jan feeder cattle (FCF3) |
Pull-back from the high |
up | break above 83.52 |
| Dec. S&P 500 E-Mini (ESZ2) |
Pull-back from the high |
up | break above 915 |
| Dec. bean oil (BOZ2) |
Pull-back from the high |
up | break above 22.79 |
In last night’s setups we featured a chart of Dec.
cotton (CTZ2)
rallying from a pullback from the high. We alerted traders to this
potential play when CTZ2 tested the 20-day simple moving average and
closed above the 38.2% retracement zone. On the TradingMarkets.com
Trend Matrix CTZ2 has Green Arrows for the Intermediate and
Long Term Trend. CTZ2 also has an up trending ADX
of 28. The trigger was a break above 48.50. Dec. cotton. Today Dec.
cotton rose 1.33 or 2.79% to 49. We are looking for a break above
49.60 for a new leg up.
Please note that while there are strong trends, one bar or a series
of bars forming a setup can sometimes indicate a contra move for the
next day. This contra move may not be long-lasting — maybe only for a
day or two. Trading with the main trend is always the highest
probability trade.
Use stops on all your trades.