This Blog provides futures market outlook for different commodities and futures trading markets, mostly stock index futures, as well as support and resistance levels for Crude Oil futures, Gold futures, Euro currency and others. At times the daily trading blog will include educational information about different aspects of commodity and futures trading.
ECB decision and verbiage in regards to Euro Zone QE will move the markets early tomorrow morning ( 7:30 AM central time). Be aware and be ready.
We got a sneak preview today when some reports came out in regards to this matter.
VOLATILITY is the keyword today and the last few weeks.
Personally I think this market has been harder to trade.
Do your homework. Review the charts over different time frames.
Do you need to adjust entry techniques? Do you need to use LESS leverage? Perhaps your stops needs to be adjusted based on volatility?
i am just throwing some ideas out there to help you think, research and hopefully implement and adapt to what I consider a different market for day trading than we have seen for most of 2014.
In between I am sharing with you my Crude Oil 18 tick range bar chart from today with some good and some not so good signals for your review:
CLE – Crude Light (Globex), Equalized Active Continuation : Range Bar, 18 Tick Units
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Some more light on what happened last week with the Swiss Franc which affects all markets across the board in one way or another. From our friends at Trade The News:
TradeTheNews.com Weekly Market Update: Swiss Mess
The Swiss National Bank roiled global markets this week by unceremoniously removing the 1.2000 floor put under the EUR/CHF cross back in 2011, prompting the franc to gain as much as 35% versus the euro on Thursday. Social media christened the move “Francogeddon” and the CEO of Swatch called it a tsunami. SNB Chief Jordan said his strategy was to “take markets by surprise,” and he succeeded. The SNB move was widely taken as another confirmation that the ECB will move on its QE program next week. Just 24-hours earlier the EU’s highest court gave the ECB a green light to proceed with QE, even as December euro zone CPI data showed most member states in negative inflation. Front-month WTI and Brent crude reached parity on Tuesday for the first time since the summer of 2013, as both February contracts traded below $46, but prices regained some ground later in the week. In the US, December inflation readings slipped lower, giving the doves on the Fed ammunition for their arguments that rate hikes can wait. Note that the yield on the 10-year UST has contracted nearly every session in January, and traded as low as 1.70% after the SNB’s move on Thursday. Gold rallied pushing the futures back above the 200-day moving average for the first time since late summer. For the week, the DJIA fell 1.3%, the S&P500 dipped 1.2% and the Nasdaq lost 1.5%.
Eleven out of 18 euro zone nations reported negative inflation rates for the month of December, while total Eurozone CPI in December was -0.2% y/y, at its lowest rate since September 2009. The biggest downward impacts in the reports were from fuel prices, clearly demonstrating the impact of the oil meltdown. ECB’s Coeure responded to the data by saying the euro zone is still not in deflation but the risk of deflation has worsened.
With inflation on a slippery slope, few doubt that the ECB QE is right around the corner (the SNB least of all). On Wednesday, the European Court of Justice handed down a non-binding opinion that the 2012 OMT bond-buying blueprint did not break EU law. Anti-QE German hawks had brought the case, hoping to forestall what they saw was bad policy. Not surprisingly, Bundesbank Chief Weidmann claimed the court’s opinion also showed that there were legal limits on the ECB, citing commentary in the opinion that said the ECB’s activities need safeguards to prevent violations of the prohibition against direct financing of governments. By Friday reports were suggesting Draghi presented Merkel and her staff a plan for QE that they could live with which will be centered on national central banks purchasing their own countries bonds.
Swiss franc made a huge move today as Swiss officials decided to detach the Swiss rate from the Euro currency….This was probably the biggest one day move I have witnessed in any commodity/futures market percent wise in my 17 years as a broker ( at the high today it was up approx. 25%, closed up 17%!!!)…..
Monthly chart below for general knowledge below…
SF6 – Swiss Franc (Globex), Monthly Continuation
And repeating yesterday’s words below as today was even a crazier day than any so far…..
VOLATILITY is the keyword today and the last few weeks.
Personally I think this market has been harder to trade.
Do your homework. Review the charts over different time frames.
Do you need to adjust entry techniques? Do you need to use LESS leverage? Perhaps your stops needs to be adjusted based on volatility?
i am just throwing some ideas out there to help you think, research and hopefully implement and adapt to what I consider a different market for day trading than we have seen for most of 2014.
Our blog is nominated for the STAR award once again!
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Very volatile day in stock index futures and energy markets along with grains and a few others….
30 minutes ago I was planning to write on how today’s action may be a bearish signal but then stocks rebounded to close near the unchanged level and lead me to believe that we still need to see a decision day/point where either the bulls or the bears take the market sharply higher/ lower….
Mini Russell 2000 daily chart for your review. My opinion is that the Russell been some what of a leader in the volatile moves we have seen.
Wide range today and I am tempted to say, I would be on the sidelines waiting to see if we can break above 1200 or below 1162 before having a directional bias for the short-medium term.
TFE – Russell 2000 Index Mini, Equalized Active Daily Continuation (Delayed by 10 Mins.) : Heikin-Ashi
Global equity markets were racked with volatility this week, as competing economic themes vied for dominance. Monday and Tuesday were dominated by concerns about the increasing risk of European deflation and the euro zone potentially unraveling over a renewed Greek crisis. The risk on tone was restored on Wednesday as Chancellor Merkel gave assurances that Germany wants Greece to stay in the euro. Mid-week sentiment was also helped by an Obama Administration announcement that the FHA would dramatically cut its mortgage insurance premiums in hopes of kick-starting the still anemic housing market. Fed policy minutes reinforced the stance of “patience,” while the new slate of dovish FOMC voters flexed their wings, highlighted by Chicago Fed President Evans who proclaimed that raising rates before 2016 would be a “catastrophe.” By Friday, deflation fears were setting in again, as Brent crude hit fresh 5-year lows and the US jobs data showed that last month’s signs of nascent wage inflation had evaporated. The US 10-year yield retreating back below 2% signaled increased investor anxiety as the week drew to a close. The DJIA notched five straight triple digit moves and for the week fell 0.5%, while the S&P500 dipped 0.6% and the Nasdaq lost 0.5%.
The headline US jobs data showed better than expected payroll gains and another tick down in unemployment to 5.6%, but dissection of the report focused chiefly on the disheartening hourly earnings component. The very healthy November gain in wages was cut in half by revisions (to +0.2% from the preliminary +0.4%), and December hourly earnings were -0.2% m/m. The data pulled the y/y growth rate to its lowest level in more than two years (+1.7%). Note that the Fed is on record with its desire to see wage growth accelerate to +3% y/y to help it achieve its 2% inflation target.
The FOMC minutes out on Wednesday confirmed that if the labor market continues to heal, then the Fed is likely to raise rates in the middle of the year even as they remain “patient” on hikes for now. Many analysts say higher rates are likely to happen even if there is little progress on inflation. The WSJ’s Hilsenrath argued that a case is to be made that lower long-term yields may even push the Fed to hike sooner, given they could be a sign of global funds flowing into the US economy and away from anemic overseas markets, potentially inflating various asset bubbles.
The recent sell off and volatility in crude oil grabbed many headlines these past few months.
Crude oil has been one of my favorite markets for day trading over the last 10 years or so because of it’s volatility and the fact that it either rewards you or punishes you very quickly…
I wish you and your family a happy, healthy 2015 and of course a successful trading year in 2015!!
Hello 2015….Volatility and downside pressure are the dominate force to start the new year, however we have seen this before more than a few times in the past only to witness the market rally fast and big within days….The million $$ question,: Is this correction any different or is this a buying opportunity….Must admit I have no clue…..
I think a break below 1978 can trigger a move down to 1909. If the market can hold and stay above 1978 we may see a run back towards 2046.
Regardless of this medium term outlook, the main thing for most of you day traders out there is that volatility is back, the pressure is now even going both ways (long and short), the ranges are wider, the moves are faster and one needs to adjust their day trading accordingly.
Daily chart of the mini SP 500 for your review below:
EP – E-Mini S&P 500, Equalized Active Daily Continuation
RISK DISCLOSURE: Past results are not necessarily indicative of future results. The risk of loss in futures trading can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition.
