Posted By: Ilan Levy-Mayer Vice President, Cannon Trading Futures Blog
1. Market Commentary
2. Futures Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000, Dollar Index
3. Commodities Support and Resistance Levels – Gold, Euro, Crude Oil, T-Bonds
4. Commodities Support and Resistance Levels – Corn, Wheat, Beans, Silver
5. Futures Economic Reports for Tuesday April 1, 2014
For 2014 I would like to wish all of you discipline and patience in your trading!
TradeTheNews.com Weekly Market Update: March Goes Out Like a Lamb
– Popular “momentum stocks” cratered this week in unison. Stocks of Facebook and Twitter tracked each other through the week, with the two names down more than 12% on the week by Thursday morning, although they retook some losses into the end of the week. Netflix gave up 12% on the week. Biotechs that set off the Nasdaq tumble last Friday saw additional losses this week, with Biogen leading the way down.
IPOs showed signs of oversaturation for the second straight week. King Digital Entertainment, the designer of the highly addictive Candy Crush mobile videogame, launched its IPO on the NYSE this week, opening for trading at 10% below the IPO price. Shares lost another 10% of their value through the end of the week, as investors worried the company is a one-hit-wonder.
– US Treasury markets spent the week consolidating after the post-FOMC recalibration. The long bond was the best performer with the yield briefly dipping back below 3.5% on Thursday. For the week the 10-year has traded up modestly, putting the benchmark rate back toward 2.7%. In the belly, yields barely budged after the recent cheapening helped demand easily gobble up this week’s new supply in 5- and 7-year paper. Despite a raft of Fed speak emphasizing that last week’s commentary did not signal any change to policy, 2015 fed fund futures contracts were little changed and continue to project the rate will rise by at least 50 basis points beginning sometime next summer.
– EUR/USD continued to back away from the ominous 1.40 area, helped along by plenty of verbal intervention. ECB President Draghi put a new spin on his same old positions by saying the ECB’s forward guidance implies short-term real rates will fall in the future. ECB’s Liikanen said a negative deposit rate was no longer a “controversial subject.” But perhaps the biggest verbal bomb came from the Bundesbank’s Weidmann, who surprised many observers by seeming to reverse Germany’s longstanding opposition to ECB QE by saying the bank might consider purchasing euro zone government bonds or top-rated private sector assets. The ECB meets next week and some analysts believe the bank needs to do something more than talk to show it’s dealing with ever-sharpening disinflation.
– China’s March flash manufacturing PMI slid to an eight-month low and saw its third consecutive month in contraction territory. The March reading could not be shrugged off as easily as weak February data that was blamed on seasonal distortions caused by the Lunar New Year. Asia markets moved higher on Monday in the wake of the data as it seemed to further cement the case for government stimulus, however later in the week respected former PBoC adviser Li Daokui cautioned that the State Council would probably not undertake more stimulus spending.
– After widening its currency trading band earlier this month, the PBoC kept markets guessing on the yuan this week. Early on, the central bank’s yuan midpoint fixing was stronger, taking USD/CNY back below the key 6.20 level on Tuesday. However the midpoint was weaker in the back half of the week, reversing the some of the gains. USD/CNY closed out the week around 6.21.
– Starting April 1st with the beginning of the new fiscal year, Japan’s sales tax will rise from 5% to 8%. The hike is part of Prime Minister Abe’s broad reform program, specifically to help fulfil his promise to achieve a budget surplus by 2020. Data out on Friday suggested that Abenomics saw a mixed performance in February: nationwide inflation accelerated to 1.5% from 1.4% in January, however overall household spending saw a 2.5% decline, its first slip in six months. While the government clearly wants the central bank to take action to help cushion the blow to growth from the tax hike, there were reports this week that BoJ Governor Kuroda does not share its pessimistic sentiment as of yet. USD/JPY was pretty tepid until Friday, when the currency ramped up to close the week just shy of 103.
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|Contract June 2014||SP500 (big & Mini)||Nasdaq100 (big & Mini)||Dow Jones (big & Mini)||Mini Russell||Dollar Index|
|Contract||June Gold||May Silver||May Crude Oil||June Bonds||June Euro|
|Resistance 3||1311.8||2023.7||103.11||134 18/32||1.3907|
|Resistance 2||1305.6||2012.3||102.54||134 1/32||1.3858|
|Resistance 1||1295.2||1995.2||102.02||133 19/32||1.3816|
|Support 1||1278.6||1966.7||100.93||132 20/32||1.3725|
|Support 2||1272.4||1955.3||100.36||132 3/32||1.3676|
|Support 3||1262.0||1938.2||99.84||131 21/32||1.3634|
|Contract||May Corn||May Wheat||May Beans||May SoyMeal||May bean Oil|
This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading