The Markets had a nice rally yesterday as news that the Greek anti austerity party Syiza had failed to form a Government which helped sooth worries about a Greek exit from the Eurozone. The baton now passes to the Pasok party to try and form a Government and if they fail we will have to have another election.
However all changed overnight as JP Morgan reported a 2 Billion Dollar loss from trading. As a result, futures markets are down hard this morning. US Weekly Jobless came in better than expected which helped the rally during the day before the JP Morgan news broke. Today we have unemployment from Canada and PPI and Michigan Survey from the US.
NOTE: All comments below refer to the June Futures Contract in each instrument
S&P 500
The market traded into my buy zone and I was able to go long at 1349. When the Jobless Nos came out the S&P was able to close the gap and I took profit at 1360. We are still in the critical 1340/1350 zone but the more times we test this 1340 level the chances are that we will have a break which should lead to a move down to 1320/1325. Today I will look to buy from 1340/1344 with a 1338 stop as we now a large down gap. If I am taken long I will look to take profit from 1351/1354. I will also look to go short in front of 1360 with a 1366 stop.
IBEX
The IBEX traded up to my sell level at 6870 and I was able to take profit on my 6705 long. This 6700 level is huge and I will still buy on any dip back to this level with a 6650 stop. The IBEX is down 70% from its highs and I do not want to be short.
EURO/USD
I was stopped out of my small long position at 1.2930. The Euro is very hard to trade as the US does not want a strong Dollar at this time and we have the risk of QE3 which will weaken the Dollar. If the Equity markets continue to weaken then QE3 will become more likely. Today I will look to buy the Euro on any sell off to 1.2850 with a 1.2810 stop. I will also look to sell on any rally from 1.2970/1.3000 with a 1.3020 stop.
Bund
The Bund just missed my profit level at 142.20 with a 142.25 low. I am still short from 142.95 and I will leave my stop the same at 143.10.
FTSE
The FTSE traded up to the 5540 level after the US Market opened and I was able to take profit on my 5480 long. Today I want to buy in front of 5450 with a 5420 stop. Again I am only trading in small size given the volatility
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