Quiet Setups

  • March 19, 2001
  • Marc Dupee

It’s a quiet session in futures trading, but many
contracts are setting up despite a session marked by low volatility. 

In the currencies, most contracts gapped up against the
dollar but have slipped from their highs of the session. If the Fed cuts rates
by 50 basis points rather than 75 (.75%), this should keep June dollar index futures
(
DXM1 |
Quote |
Chart |
News |
PowerRating)
(from the Momentum-5
and
New 10-Day Highs lists) on track for additional upside progress. 


British pounds
(
BPM1 |
Quote |
Chart |
News |
PowerRating) may get hit particularly hard, not only because of
the interest rate differential, but also because of the multi-billions in
economic losses forecast from the foot-and-mouth livestock disease outbreak. Not
only are millions of animals forecast to be slaughtered, industries from tourism
to transportation are likely to be negatively impacted. The BPM1, like
Japanese yen
(
JYM1 |
Quote |
Chart |
News |
PowerRating),

euro FX futures
(
ECM1 |
Quote |
Chart |
News |
PowerRating),

Swiss francs
(
SFM1 |
Quote |
Chart |
News |
PowerRating) and Canadian dollars
(
CDM1 |
Quote |
Chart |
News |
PowerRating) are on
theNew 10-Day Lows List.

I’ve mentioned cocoa in previous commentaries as breaking
down from a head-and-shoulders top formation. Cocoa
(
CCK1 |
Quote |
Chart |
News |
PowerRating), also
from the
New 10-Day Low List, nearly matched a two-month low and is off 22 at 1006.

Pork contracts, a Momentum-5
contract, are holding up well despite dramatic increases that have left them
overbought. April lean hogs
(
LHJ1 |
Quote |
Chart |
News |
PowerRating) retraced Friday’s real bar, but
did not trade down into the gap, a sign of support. May pork bellies
(
PBK1 |
Quote |
Chart |
News |
PowerRating)
gapped to a new contract high and are higher on the session, up .300 at 91.800.

Grain contracts May wheat
(
WK1 |
Quote |
Chart |
News |
PowerRating) and
soybeans
(
SK1 |
Quote |
Chart |
News |
PowerRating) are registering Turtle Soup buy
signals–reversal signals that occur in the same day rather than on the
following day as in the Turtle Soup Plus One signals on the daily
Futures Indicators Page. If we get a bit of a bounce and the grains rally, soybean oil
(
BOK1 |
Quote |
Chart |
News |
PowerRating),
could be an interesting upside trade out of its Pullback From Highs
setup.