Pork Bellies May Be Too Fat
Each evening we focus on the most interesting aspects for the upcoming trading day. The comments are based on observations of the nightly updates of the Futures and Market Bias pages. They are provided for educational purposes only and are not intended to be direct trading advice. Also, keep in mind that these remarks are made up to 12 hours in advance of the markets opening. Therefore, overnight events may alter the outcome of these observations.
At the time this is being published, the S&P Globex Futures are trading 3.50 points lower and the Bond Market Futures are trading up 16 ticks.
February Pork Bellies [PBG0>PBG0], gapped open to new 20-day highs today (a) but reversed to close poorly (b). This may have breakout players trapped on the wrong side of the market. Look for a shorting opportunity here.
For you breakout players, the energies (mentioned last night), November Crude Oil [CLX9>CLX9], Heating Oil [HOX9>HOX9] and Unleaded Gas [HUX9>HUX9], are all now at life-of-contract highs. Continue to look for a buying opportunity here or better yet, wait for a pullback.
Continuing on the breakout theme, the December British Pound [BPZ9>BPZ9], on the Momentum 5 List, rallied to close at a 6-month high today reversing yesterday’s sell off. Look for a buying opportunity here.
March Sugar [SBH9>SBH9], on the Pullbacks Off Highs List, is a high-level “mini†cup and handle. Look for a buying opportunity here.
Volatility Watch
December Coffee [KCZ9>KCZ9] is now on all three Volatility Explosions Lists. Continue to watch for a larger-than-normal move (in either direction) as volatility reverts to its mean.
Best of luck with your trading on Friday!
Dave Landry
PS-Reminder: Protective stops on every trade!