US Equities ground out small gains in a fairly featureless trading session on Friday with the S&P closing 0.2% higher at 1961. The VIX Volatility Index closed the week at 11.27 which is historically extremely low. Of some help to risk assets was the uplift in the University of Michigan’s final June Consumer Confidence Reading at 82.5, from the 81.2 preliminary reading, following on from the better than expected Conference Board Confidence June Reading last week. Earlier in the day, Germany’s June CPI popped higher to 0.4% month on month and 1.0% year on year, up from 0.6% in May and 0.7% expected. This will help the ECB’s no deflation risk cause. The National measure rose to 1.0% from 0.9% as expected.
The US Dollar struggled against all major Currencies on Friday with the Dollar Index falling 0.25% to 80.04 with the USD/JPY in particular down to 101.40, which is its lowest closing level since mid-May.
This morning on the economic front we have UK Mortgage Approvals and Net Consumer Credit at 9.30 am. This is followed at 10.00 am by Euro-Zone CPI and Money Supply. At 2.45 pm we have the US Chicago Purchasing Manager’s Survey followed at 3 pm by US Pending Home Sales and the Dallas Fed Manufacturing Activity. At 6.10 pm the Fed’s Williams is due to speak on the economy.
September S&P 500
The S&P traded in a very narrow range on Friday on what surprisingly was a very strong volume day. It just missed my 1940 buy level with a 1942.25 low before spending the rest of the day trading higher with the market eventually rising to my 1952 sell level. I was still short over the weekend but given the fact that today is both quarter and month end and the fact that traditionally this is seasonally one of the strongest weeks of the year I have decided to cover this position for a small loss at 1953 and I am now flat.
Today I will be a small buyer on any dip to 1945/1949 with a 1940 stop. My only interest in selling the market is on a rally to 1961/1965 with a 1971 stop as 1970 is the next key resistance level.
Euro/USD
The Euro continues to consolidate above the important 1.3580/1.3600 support level. After I posted on Friday It made a low of 13607 just missing my 1.3605 buy level before spending the rest of the day trading higher. It was helped by the stronger German CPI release. Today I will raise my buy level to 1.3610/1.3630 with a 1.3570 stop. I still do not want to be short the Euro at this time.
US Dollar Index
No change as I am still long from earlier in the month at 80.25 with the same 79.90 stop as the Dollar tries to hold the key 80.00 support level. If I am stopped out of this position I will be a more aggressive buyer in front of 79.70 with a 79.45 stop.
September DAX
Last Friday was not my day as most of my planned long positions just fell short of triggering an entry. This was especially the case with the Dax which just missed my 9800 buy level by a few points before also spending the rest of the day trading higher and I am still flat. The key resistance level for the Dax is at 9945 and then from 10030/10110 Today I will be a small seller on any rally to 9910/9940 with a 9960 stop. I will also raise my buy level to 9825/9855 with a 9795 stop which is just below last Friday’s low.
September FTSE
I am still flat the FTSE and today I will raise my buy level slightly to 6675/6695 with a 6655 stop. Given the fact that today is month and quarter end I do not want to be short the FTSE at this time.
Dow Rolling Contract
The Dow worked well on Friday as shortly after I posted it traded down to my 16790 buy level. The market had a nice rally into the close which enabled me to cover this position at 16840 and I am now flat. Today I will again be a small buyer on any dip to 16760/16790 with a 16730 stop. I still do not want to be short the Dow at this time.
September BUND
No change as I am still short from last week at 146.85 with the same 147.25 stop which is just above last Thursday’s high at 147.18.
Gold Rolling Contract
Gold is finding it difficult to break and close over the 1320 resistance level. I am still flat and today I am going to lower my buy level to 1299/1306 with a 1293 stop.
Silver Rolling Contract
I was finally stopped out of my long 19.58 position from earlier in the month at 20.90 overnight and I am now flat. I still like Silver as I believe this market can trade back to the 25.00 resistance level over the coming weeks. Today I will be a buyer from 20.55/20.80 with a 20.25 stop.
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