Six Scream S&Ps To Slump
Six signals from the
Market
Bias Indicators Page, all pointing down, were practically screaming that
stock index futures could pull back from their torrid runs this morning. Nasdaq 100 futures
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have rallied 15% this week in four consecutive up sessions and S&P futures
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are up 6.5% on the week. Both are trading on the bottom of today’s range in an
intraday descending-triangle/head-and-shoulders pattern.Â
Interest rate futures are rallying as stock indexes
pullback. Bonds had slipped as many as 7 big points since their March 22 high as
traders adjusted positions to account for a change from a contracting to an
expanding economic forecast (the Fed has cut interest rates four times this year
and US short-term rates are now .25% below European rates at 4.5%). T-bonds
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have traded straight up since their opening down-tick and are currently up 13/32
at 100 30/32. 10-year notes
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intraday, triple tops after a run 7/32 higher.
June dollar index futures
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PowerRating) gapped down below a head-and-shoulders top in a negative technical development for the DXM. The Japanese yen
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is tempering the dollar’s losses after Finance Minister Kiichi Miyazawa implied
Japanese policy makers do not want too strong of a yen while the country tries
to export its way to economic health. The yen had rallied for four straight days
but is down .0057 to .8223. Notice the symmetry in the pullbacks.
Soybeans
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PowerRating)Â are rallying
slightly out of their Turtle Soup Plus One Buy
setup but the pattern of descending tops makes it look as if its descending-triangle setup will play out. Traditional measured-move analysis out of
this pattern suggests a test of 415 (for additional information on calculating
measured moves out of such patterns, see my
article on the topic).Â
June lean hogs
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setup out of a narrow pattern, providing defined-risk entry. This chart could be
interpreted as a bullish flag or bearish triple tops (H&S), so look to play
either way.