H. Hawkins, Part 2 Tomorrow
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 1.70 points higher and the Bond Market Futures are up 1 tick.
Heads up, tomorrow Alan Greenspan will deliver part two of his Humphrey-Hawkins testimonial. Although more of the same is expected, remarks to new questions could spark volatility in both the stock and bond market futures.
Tonight, we have three indicators pointing higher on the Market Bias Page combined with an oversold McCllean Oscillator. This suggests we will have an upside bias for September Dow Jones [DJU9>DJU9] and S&P [SPU9>SPU9] Index Futures tomorrow. Just wait for follow through, however, before getting too bullish as there was some selling near the close in both the cash and futures markets.
For you breakout/momentum players, the recent slide (a) in the September US Dollar [DXU9>DXU9] has caused tremendous rallies in the September Swiss Franc [SFU9>SFU9], D-mark [DMU9>DMU9] and Japanese Yen [JYU9>JYU9] (all on the Momentum 5 List). Look for buying opportunities here or better yet, wait for a pullback.
Source: Omega Research.
Volatility Watch
September Orange Juice [OJU9>OJU9] is now on the Volatility Explosions-Low 6/100 Readings List. Watch for a larger-than-normal move (in either direction) as volatility reverts to its mean.
Best of luck with your trading on Wednesday!
Dave Landry
PS-Reminder: Protective stops on every trade!