Euro Currencies Continue To Rally On Good Peace Talks
| PREVIOUS POSITIONS | ||||||
|---|---|---|---|---|---|---|
| Market | Long/Short | Entry | Exit | P/L (per contract) | ||
| September T-bonds | Long | 116-06 | 115-05 | -$1031.25 | ||
| September S&Ps | Short | 1328 | 1327 | $250 | ||
| September Swiss franc | Long | .6555 | .6575 | $250 | ||
| CURRENT POSITIONS (as of 6/11/99) | ||||
|---|---|---|---|---|
| Market | Long/Short | Entry | Stop | Target |
| September T-bonds | Flat | – | – | – |
| September S&Ps | Long | 1322 | 1300 | 1328 |
| September Swiss franc | Flat | – | – | – |
Note: All price levels are approximate.
S&P 500 futures
We went long the September S&Ps [SPU9>SPU9] yesterday at 1322. The S&Ps were down today as the bond market took its toll on stocks. We are still long as we believe the market is still temporarily oversold. Our profit target is at the 1328 area with stops still in around 1300.
This trade will be closely linked with the bonds, which are moving this market right know. The market is in a down trending phase and volatility and price direction are increasing together.
These last couple of days have been the most difficult of the year for us. But overall, the year is still turning out very well. Patience and fortitude
are required at these times; drawdown periods are just part of the trading process.
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| Figure 1. September S&P futures (SPM9), 15-minute bar. Source: Quote.com.
|
T-bond futures
The September futures [USU9>USU9] rallied briefly this morning after the PPI came in as expected. The rally quickly faded, though, as traders still believe the Fed will raise rates at their next meeting at the end of this month.
May retail sales then came out higher than expected, which added further pressure. Our longs were stopped out as we never got to our
profit target.
This is the first rough month we have had in six months. We
will wait to see how the market reacts to the Consumer Price Index (CPI), due out on Wednesday. Volatility has increased, with prices moving down without interruption. This type of action does not happen often but when it does we sometimes have losses. Stay tuned.
Currency futures
The September Swiss franc [SFU9>SFU9] and Euro [ECU9>ECU9] SF U9 and EC U9 were up again today on follow-through from Wednesday. There was further short-covering as the peace process begins to progress in Kosovo and with the G7 meeting in Germany this weekend.
The PPI report did not have as much impact on the market as was expected. We remain on the sidelines until (possibly) next Wednesday’s CPI report.
Next scheduled update: Monday, June 14, 1999
(Check “Today’s Schedule” every day on our home page to find out about additional updates.)