Dissing The ECB
Currency traders thwarted efforts by the European Central Bank to support the
euro, hammering the
EuroFX
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PowerRating) futures after the Fed-like
body unilaterally intervened in international currency markets.
Traders capitalized on the belief that uncoordinated intervention–intervention
without the participation of the major western central banks–does not work. The
contract descended after eclipsing the previous 20-day high in a Turtle Soup
setup (a setup that fades the 20-day breakout in the same day that the breakout
attempt fails, rather than on the following day as in the more commonly
mentioned Turtle Soup Plus One). The ECZ closed the morning gap-up opening and
fell to below Thursday’s low before recovering to end .00480 higher at
.8669.Â
Economic news hit bonds and Dow futures. The Labor
Department said wages rose at an unexpectedly fast clip last month, even
as unemployment held steady, confirming Thursday’s report of higher labor costs
last quarter. The bond market did not respond favorably, tanking nearly 1 point in its worst week so far this fall. Dec. T-bonds
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closed down 29/32 at 99 7/32 and
10-year notes
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Dow futures
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rising costs diminished prospects for improved earnings returns. The Dec.
contract contracted 37.0 to 10,888.0.
December S&P futures
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$13 range.
NASDAQ 100 futures
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earnings returns from Qualcomm and the undoing of negative rumors at Oracle, two
of the most heavily weighted stocks on the Nasdaq 100 index
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PowerRating). The Dec.
Naz futures closed 36.50 lower at 3353.00.
Grains followed through on recent strength. Corn
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made good on its Momentum-5
List reading, though ending up just 1 1/4 at 213 1/4. Wheat was the big
winner in the grain complex on the session, closing up 4 1/4 at 264.
Coffee sank to a seven-year low. The contract made good
on a Momentum-5 and
a 6/100 Low Volatility
setup to new lows, before recovering to end down .65 at 73.60. Watch this one
for a reversal Monday at the previous 20-day low as this contract is a Turtle
Soup Plus One buy trade.
Sugar sank as many as .20 before recovering to close up
.03 at 9.57. This represents a continuation of an engulfing (candlestick)
pattern and a 1-2-3-4 pullback from low setup, a pattern, like the above coffee
setup, pointed out in Thursday’s Futures
Market Recap.
