Thursday’s Futures Setups
The ISM’s index of
manufacturing activity fell to 53.7 in August, less than expected,
but still expanding. Construction spending rose .2% in August to $882.7 billion,
less than expected.
In equity markets, breadth today was impressive, no question. Looking back to a
year ago, the Dow gained 346 points, but then fell for the next four days.
Â
This 60-minute chart of the E-minis shows where the
.618 retracement may come into play.
In looking at the volume in the SPDRs, you can see
the volume divergence, and the low volume at highs A and B. This is not to say
we can’t rally further for another day or two — it’s just that I’m suspect of
any large rally here.
Â
Coffee appears to be basing.
Â
Cattle took out the highs.
Please note that while there are strong trends, one bar or a series of bars
forming a setup can sometimes indicate a contra move for the next day. This
contra move may not be long-lasting — maybe only for a day or two. Trading with
the main trend is always the highest probability trade.
Be advised that some futures contracts are prone to gaps.
Remember, use stops on all your trades.