Financial Futures Pegged
Nasdaq 100 futures
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PowerRating) are pressured and have hit limit down
levels. The
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PowerRating) is trading on the Momentum-5
and Pullback From Lows
lists.
The gold and silver index
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PowerRating) is the strongest sector of the
session as market participants seek safe haven stocks–Newmont Mining
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is the leader here, up 1 at 15 1/8. However, the price of gold itself has not
budged. The December gold futures contract
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PowerRating) is trading in a two-week consolidation range at a one-year low. The
contract remains potentially explosive as it is wound up on the Volatility
Explosion Low 10/100 Reading. Futures contracts that post on this list are
poised to make a big move as the low volatility reverts back to its longer-term
average volatility. Dec. gold is currently trading up .6 at 266.7. The rally in
the XAU could be a precursor to a move in gold.
In the past two Futures
Market Recaps I have pointed out that weakness in foreign currencies implied that
December dollar index futures
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PowerRating) could rally. The
December dollar index futures
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DXZ0 |
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PowerRating) had been registering on the
New 10-Day High and
6/100 Low Volatility
List, implying a larger-than normal move was in store. The dollar has also
been making headway despite a bear stock market and an indeterminate US
Presidential election. The dollar index registered on the Momentum-5
for Wednesday and the December contract is extending into a two-week rally, up
.09 to 117.98.
New futures analyst Carolyn Boroden has made excellent
calls in her debut columns Monday and Tuesday that should be brought to your
attention.
In Monday’s Futures
Perspectives Carolyn wrote that if T-bond futures
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PowerRating) held
above the key 100 7/32-area, bonds could move “towards 101
02/32, 101 09/32 and even 102 05/32
on the upside.” Safe haven buying of T-bond futures have taken the Dec.
contract to new highs, and up more than 1 point in Wednesday’s session, to a high 101 24/32. The
belief that whoever wins the presidential election will experience government
gridlock, will not be able to increase tax spending and won’t disrupt the
repayment of governmental debt is also kicking T-bonds to a contract
record.
In Tuesday’s Futures
Perspectives, Carolyn nailed the S&Ps top within one handle. We have fallen more
than 30 handles from that level and 20 from Wednesday’s highs. Here is Boroden’s
Spooz analysis: “December S & P futures (SPZ0)
hit an important price decision zone late in Tuesday’s session at the 1361.00-1363.50
area. (Note the session high was made at 1362.50.) We are now considering this
a pivotal high. If price continues to remain below here, we are likely to see
new contract lows sooner rather than later.”
Also notice that Borsellino’s
S&Ps A.M. piece was prescient. Lewis commented that “If we get
below 1335, the odds are strong for a move to 1328, and more probable will be a
test of the Oct. 18 recent contract low of 1324.80.” The 1335 level
indeed provided support and the low of Wednesday’s session now stands at
1328.80. The pressure is on for a potential move to the 1324.80 area described
by Borsellino.