Wednesday’s Futures Setups

  • November 26, 2002
  • TradingMarkets Editors


Profit-takers cashed in on today’s futures
trading, as the second estimate of U.S. GDP came in at a 4.0% annual rate, up
slightly from the previous estimate. GDP in the third quarter was up 3.2% from
one year ago. The major future indices for Dec. were lower and the December
Treasuries were higher.

The Dec. 10 year T-notes
(
TYZ2 |
Quote |
Chart |
News |
PowerRating) rose
higher with talk that the economy will get slow again. TYZ2 closed at 113 145 up
+255. The Dec. 30-year bond
(
USZ2 |
Quote |
Chart |
News |
PowerRating) closed at 110 ’29 up +1 ’02.

U.S. corporate profits were down 1.8% in the
third quarter, but are still up 12.2% from a year ago and U.S. consumer
confidence was 84.1 in November, up from 79.6 in October. The Dec. S&P 500
futures
(
SPZ2 |
Quote |
Chart |
News |
PowerRating) pulled back by 18.20 to 911.50, just above its 20-day
EMA. Tomorrow will be a shortened trading day in the bond market, so we could
see more weakness in the futures.

In a separate economic report, new home sales
were at an annual rate of 1.007 million units in October, down 4.5% from
November’s pace. So far this year, new home sales are up 7% from a year ago.

The Nasdaq 100 for Dec.
(
NDZ2 |
Quote |
Chart |
News |
PowerRating)
dropped 38 points or 3.37% to 1088.50. The NDZ2 has held up well above its
20-day EMA at 1051.70.

 



March
corn futures
(
CH3 |
Quote |
Chart |
News |
PowerRating) suffered a steep decline from the early-September
high to the early-November low, this amid U.S. harvesting pressure. However, it
would now appear that the downtrend has been stopped at the 78.6% retracement
level at around the $2.41level. On the daily chart above,  the shorter-term
moving average 18-day (red) is acting as resistance along with the 70.7%
retracement line. A break above this level will have the next resistance point
at the 40-day moving average (brown). If prices cross above the key 40-day
moving average, this will be key because this is the moving average that the
commodity funds watch closely. That means pushing prices above the important
$2.50 resistance level.

In today’s trade

March
corn
(
CH3 |
Quote |
Chart |
News |
PowerRating) dropped .25 of a cent to $2.44 1/2 a bushel.

Possible
short candidates:



Contract

Setup

Direction

Trigger

March cocoa
(
CCH3 |
Quote |
Chart |
News |
PowerRating)
Pull-back
from the lows
down
break below 1723
Dec. soymeal
(
SMZ2 |
Quote |
Chart |
News |
PowerRating)

Pull-back
from the lows
down
break below 165.00
Jan. crude oil
(
CLF3 |
Quote |
Chart |
News |
PowerRating)

Pull-back
from the lows
down

break below






26.00
March corn
(
CH3 |
Quote |
Chart |
News |
PowerRating)

Pull-back
from the lows
down

break below





2.44 3/4
Dec. Canadian dollar
(
CDZ2 |
Quote |
Chart |
News |
PowerRating)

Pull-back
from the lows
down

break below 63.00

Possible
long candidates:


Contract

Setup

Direction

Trigger

March sugar
(
SBH3 |
Quote |
Chart |
News |
PowerRating)		 Pull-back
from the high		 up
break
above






7.50

Dec. euro
(
ECZ2 |
Quote |
Chart |
News |
PowerRating)		 Pull-back
from the high		 up
break
above




1.00790

Dec. S&P 500 E-Mini
(
ESZ2 |
Quote |
Chart |
News |
PowerRating)		 Pull-back
from the high		 up break
above 915

Dec. bean oil
(
BOZ2 |
Quote |
Chart |
News |
PowerRating)		 Pull-back
from the high		 up break
above 22.79


Today on the S&P 500 E-Mini
(
ESZ2 |
Quote |
Chart |
News |
PowerRating), it attempted to penetrate the
short-term resistance level at at the 84.1% line 934.31. This line was drawn from the Aug
high to the Oct low. A further move up from this level, will have the ESZ2 challenging the 940
area then after that the 950 area.

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.

Use stops on all your trades.