July Heating Oil Buying Opportunity?
Each evening we focus on the most interesting aspects for the upcoming trading day. The comments are based on observations of the nightly updates of the Futures and Market Bias pages. They are provided for educational purposes only and are not intended to be direct trading advice. Also, keep in mind that these remarks are made up to 12 hours in advance of the markets opening. Therefore, overnight events may alter the outcome of these observations.
At the time this is being published, the S&P Globex Futures are trading 2.10 points higher and the Bond Market Futures are trading up 4 ticks.
July Heating Oil [HON9>HON9], on the New 10 Day Lows List, gapped lower on today’s open to new two month lows but rallied to close well. Look for a buying opportunity as the breakout (or more accurately “breakdownâ€) players may be trapped on the wrong side of the market.
July Coffee [KCN9>KCN9], on the Momentum 5 and Pullbacks From Highs Lists, still looks like it has the potential to pivot back in the direction of its breakout. Look for a buying opportunity here.
Volatilty Watch
September Bonds [USU9>USU9] are now on the Volatility Explosions-Low Multiple Days Readings List. Notice that after hitting major new lows, the contract has drifted upward (a). This “orderly†drift has caused volatility to drop off. Look for a shorting opportunity here as the bigger picture trend remains down.
Source: Omega Research.
The June D-mark [DMM9>DMM9] remains on the Volatility Explosions — Low Multiple Days Readings List. Continue to watch for a larger-than-normal move (in either direction) as volatility reverts to its mean.
Best of luck with your trading on Wednesday!
Dave Landry
PS-Reminder: Protective stops on every trade!