Posted By: Ilan Levy-Mayer Vice President, Cannon Trading Futures Blog
For 2014 I would like to wish all of you discipline and patience in your trading!
FOMC notes from Econoday.com:
Emphasis was on the labor market which was upgraded with the comment, “Labor market conditions have improved , with the unemployment rate declining further.” But it was also noted, “a range of labor market indicators suggests that there remains significant underutilization of labor resources.”
The economy is seen as having rebounded from the anemic first quarter with household spending rising moderately and business fixed investment advancing. Housing is seen as remaining slow.
Inflation is closer to the Fed’s long-term goal and longer-term inflation expectations have remained stable.
Due to continued progress in the labor market, the FOMC decided to take a further measured reduction in asset purchases.
“Beginning in August, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $10 billion per month rather than $15 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $15 billion per month rather than $20 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction.”
The Fed noted that further asset purchases are likely to be cut back at a measured pace even though the reductions are not on a preset course.
The FOMC statement noted “that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee’s 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.”
The Fed also indicated that the rise in policy rates is likely to be slow with the comment that even after the Fed achieves policy mandates (unemployment and inflation), that the fed funds rate may be below levels the Committee views as normal in the longer run.
Voting against was Charles I. Plosser who objected to the guidance indicating that it likely will be appropriate to maintain the current target range for the federal funds rate for “a considerable time after the asset purchase program ends,” because such language is time dependent and does not reflect the considerable economic progress that has been made toward the Committee’s goals.
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Futures Trading Levels
|Contract Sept. 2014||SP500||Nasdaq100||Dow Jones||Mini Russell||Dollar Index|
|Contract||December Gold||Sept.Silver||Sept. Crude Oil||September Bonds||Sept. Euro|
|Resistance 3||1316.5||2106.7||103.26||140 8/32||1.3466|
|Resistance 2||1310.9||2091.3||102.47||139 21/32||1.3442|
|Resistance 1||1304.5||2078.7||101.02||138 18/32||1.3418|
|Support 1||1292.5||2050.7||98.78||136 28/32||1.3370|
|Support 2||1286.9||2035.3||97.99||136 9/32||1.3346|
|Support 3||1280.5||2022.7||96.54||135 6/32||1.3322|
|Contract||Dec Corn||Sept. Wheat||Nov. Beans||Dec. SoyMeal||Dec. bean Oil|
|ThuJul 31||1:00am||JPY||Housing Starts y/y||-11.2%||-15.0%|
|2:00am||EUR||German Retail Sales m/m||1.1%||-0.6%|
|GBP||Nationwide HPI m/m||0.6%||1.0%|
|2:45am||EUR||French Consumer Spending m/m||0.3%||1.0%|
|3:55am||EUR||German Unemployment Change||-5K||9K|
|4:00am||EUR||Italian Monthly Unemployment Rate||12.6%||12.6%|
|5:00am||EUR||CPI Flash Estimate y/y||0.5%||0.5%|
|EUR||Core CPI Flash Estimate y/y||0.8%||0.8%|
|EUR||Italian Prelim CPI m/m||0.1%||0.1%|
|7:30am||USD||Challenger Job Cuts y/y||-20.2%|
|USD||Employment Cost Index q/q||0.5%||0.3%|
|10:30am||USD||Natural Gas Storage||92B||90B|
|7:30pm||AUD||AIG Manufacturing Index||48.9|
|9:35pm||JPY||Final Manufacturing PMI||50.8||50.8|
|9:45pm||CNY||HSBC Final Manufacturing PMI||52.0||52.0|
|11:30pm||JPY||BOJ Gov Kuroda Speaks|
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