Good Morning Traders,
As
of this writing 5:00 AM EST, here’s what we see:
US Dollar –Up at 82.720, the Sept US Dollar is up 93 ticks and is trading at 82.720.
Energies – August Oil is down at 104.86.
Financials – The September 30 year bond is down 3 ticks and is trading at 134.28.
Indices – The September S&P
500 emini ES contract is down at 1668.75 and is down 9 ticks.
Gold – The August
gold contract is trading down at 1285.00 and is down 54 ticks from its close.
Initial Conclusion: This is not a correlated market. The dollar is up+ and
oil is down- which is normal but the 30 year bond is trading lower. The Financials should always correlate
with
the US dollar such that if the dollar is lower then bonds should follow
and vice versa. The indices are down and the US dollar
is trading higher which is correlated. Gold is trading lower which is correlated with the
US
dollar trading up. I tend to believe
that Gold has an inverse
relationship with the US Dollar as when the US Dollar is down, Gold
tends to rise in value and vice-versa. Think of it as a seesaw, when one
is up the other should be down. I point this out to you to make you
aware that when we don't have a correlated market, it means something is
wrong. As traders you need to be aware of this and proceed with your
eyes wide open.
Asia closed mixed with the half the exchanges closing lower and the other half higher. As
of this
writing all of Europe is trading lower.
Possible challenges to
traders today is the following
1. Building Permits are out at 8:30 AM EST. This is major.
2. Housing Starts are out at 8:30 AM EST. This is major.
3. Ben Bernanke speaks at 10 AM EST. This is major.
4. Crude Oil Inventories are out at 10:30 AM EST This will move the oil markets.
5. FOMC Member Raskin speaks at 12:30 PM EST. This is major.
6. Fed Beige Book is out at 2 PM EST. This could impact afternoon trading.
Yesterday we said our bias was to
the downside as Gold was lower and Europe was trading lower. The
net result? The Dow Closed 32 points lower. Today we are not dealing with a correlated market and our bias is to the downside. Why? The USD is higher and the Bonds are down, Gold is trading lower and Europe is all trading down. Could
this change? Of Course. Remember anything can happen in a volatile market.
Yesterday we said our bias was to
the downside as the markets as such. CPI came in higher which is not good for consumers and spending as it means that we consumers are paying more for goods and services. The NAHB came in better than expected but I suspect the CPI number put a damper on the markets. Then came 2:15 PM and after a nice day whereby FOMC Member Tarullo said nothing, FOMC Member Esther George decided to state that she thinks the Fed should taper sooner as opposed to later. That sealed it for the markets as the Dow and other indices closed lower. Today we have Ben Bernanke speaking to Congress for the next two days (Wednesday & Thursday). Of course, we have no idea what he's going to say but obviously each time one of these members speak it becomes confusing as they each have their own opinion and aren't afraid to voice it. My train of thought says they need to borrow a page from Corporate America and start singing out of the same hymn book, so to speak....
On Friday, June 7th I had the
opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a
20 year veteran of the Insurance Industry and we spoke at length
regarding the ramifications of the Patient Protection and Affordable
Care Act aka ObamaCare. If you are at all concerned about the future of
Health Insurance in the United States, then you need to listen to this
interview and act on it. Sal and his team is offering complimentary
advisory services to inform you of your rights and ramifications of this
Act.
As an update on this issue, last week
the White House extended the employer's mandate to 2015 versus 2014 and
currently the house will vote on a similar measure for individuals. The
question is can you trust the folks in DC to implement anything?
To download the article on ObamaCare, go to:
https://markettealeaves.sharefile.com/d/s978a806ae2e41569
To view my discussion with Sal:
http://youtu.be/sR_ine0b5Ro
As
readers are probably aware I don't trade equities. While we're on
this discussion, let's define what is meant by a good earnings report. A
company must exceed their prior quarter's earnings per share and must
provide excellent forward guidance. Any falloff between earning per
share or forward guidance will not bode well for the company's shares. This is one of the
reasons I don't
trade equities but prefer futures. There is no earnings reports with
futures and we don't have to be concerned about lawsuits, scandals,
malfeasance, etc.
Anytime
the market isn't correlated it's giving you a clue that something isn't
right and you should proceed with caution. Today our bias is to the downside.
Could this change? Of course. In a
volatile market anything can happen. We'll have to monitor and see.
In
May, I spoke with John Karnas, CEO of Trend Following Trades. John has
an interesting background as he was a trader for a number of years
prior to buying Trend Following Trades. John is a believer in Trading
Plans and has a very precise method of developing aspiring traders. To
download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at:
http://youtu.be/uVwHpMq1604
Please
note the video is about a half hour in length and we plan on producing
more in the near future. Also note that in the near future we will have
other videos where we will interview various trading leaders.
As
I write this the crude markets are trading lower and the US
Dollar is advancing. This is normal. Think of it this way. If the
stock
market is trading lower, it's safe to assume that the crude market will
follow suit and vice versa. Crude trades with the expectation that
business activity is expanding. The barometer of which is the equities
or stock market. If you view both the crude and index futures side by
side you will notice this. Yesterday August crude dropped to a low of 105.66 a
barrel and held. We'll have to monitor and see
if
crude
either goes lower or holds at the present level. It would appear at
the present time that crude has support at $103 a barrel and resistance
at 108. This could change. All we
need do is look at what happened last fall when crude was trading over
$100.00 a barrel. We'll have to monitor and see. Remember that crude is
the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude
oil is trading lower and the US Dollar is advancing. This is normal.
Crude typically makes 3 major moves (long or short) during the
course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when
the crude market closes. If crude makes major moves around those time
frames, then this would suggest normal trending, if not it would suggest
that something is not quite right. If you feel compelled to trade
consider doing so after 10:30 AM when the inventory numbers are released and the markets give us better
direction. As
always watch and monitor your
order flow as anything can happen in this market. This is why
monitoring order flow in today's market is crucial. We as traders are
faced with numerous challenges that we didn't have a few short years
ago. High Frequency Trading is one of them. I'm not an advocate of
scalping however in a market as volatile as this
scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.forexcrunch.com/the-taper-caper/
http://www.traderslog.com/john-karnas/
Remember
that without knowledge of order flow
we as traders are risking our hard earned capital and the Smart Money
will have
no issue taking it from us. Regardless of whatever platform you use for
trading purposes you need to make sure it's monitoring order flow.
Sceeto does an excellent job at this. To fully capitalize on
this newsletter it is important that the reader understand how the
various market
correlate. More on this in subsequent editions.
Wednesday, July 17, 2013
Tuesday, July 16, 2013
Pre-Market Glogal Review - 7/16/13 - Down Retail Sales Can't Dent Dow
Good Morning Traders,
As of this writing 5:15 AM EST, here’s what we see:
US Dollar –Up at 83.230, the Sept US Dollar is up 34 ticks and is trading at 83.230.
Energies – August Oil is up at 106.48.
Financials – The September 30 year bond is up 13 ticks and is trading at 135.00.
Indices – The September S&P 500 emini ES contract is down at 1676.25 and is down 3 ticks.
Gold – The August gold contract is trading down at 1283.10 and is down 4 ticks from its close.
Initial Conclusion: This is not a correlated market. The dollar is up+ and oil is up+ which is not normal and the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are down and the US dollar is trading higher which is correlated. Gold is trading lower which is correlated with the US dollar trading up. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
All of Asia closed higher with the exception of the Indian Sensex. As of this writing all of Europe is trading lower.
Possible challenges to traders today is the following
1. Core CPI is out at 8:30 AM EST. This is major.
2. CPI is out at 8:30 AM EST. This is major.
3. TIC Long Term Purchases are out at 9 AM EST. This is not major.
4. Capacity Utilization Rate is out at 9:15 AM EST This is not major.
5. Industrial Production Rate is out at 9:15 AM EST. This is not major.
6. NAHB Housing Market Index is out at 10 AM EST. This is major.
7. FOMC Member George Speaks at 2:15 PM EST. This is major.
Yesterday we said our bias was to the upside as Gold was higher and Asia and Europe were both higher. The net result? The Dow Closed 20 points higher. Today we are not dealing with a correlated market and as such our bias is to the downside today. Why? The USD and crude are not correlated, Europe is trading lower and Gold is also trading lower. Could this change? Of Course. Remember anything can happen in a volatile market.
Yesterday we said our bias was to the upside and despite a not too stellar retails sales report the Dow eked out a 20 point gain. This was not bad considering Retail Sales that came in at 0.4% versus 0.7% expected. Of course the Empire State Manufacturing Index came in higher at 9.5 versus 5.2 expected. FOMC Member Tarullo spoke about Dodd-Frank implementation and did not voice a policy comment or statement which I think helped as well. The question is will we be as fortunate today as FOMC Member George speaks at 2:15 PM EST? Only time will tell...
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. As an update on this issue, last week the White House extended the employer's mandate to 2015 versus 2014 and currently the house will vote on a similar measure for individuals. The question is can you trust the folks in DC to implement anything? To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569
To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As
readers are probably aware I don't trade equities. While we're on
this discussion, let's define what is meant by a good earnings report. A
company must exceed their prior quarter's earnings per share and must
provide excellent forward guidance. Any falloff between earning per
share or forward guidance will not bode well for the company's shares. This is one of the
reasons I don't
trade equities but prefer futures. There is no earnings reports with
futures and we don't have to be concerned about lawsuits, scandals,
malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the downside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading higher and the US Dollar is advancing. This is not normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.65 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading higher and the US Dollar is advancing. This is not normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.forexcrunch.com/the-taper-caper/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
As of this writing 5:15 AM EST, here’s what we see:
US Dollar –Up at 83.230, the Sept US Dollar is up 34 ticks and is trading at 83.230.
Energies – August Oil is up at 106.48.
Financials – The September 30 year bond is up 13 ticks and is trading at 135.00.
Indices – The September S&P 500 emini ES contract is down at 1676.25 and is down 3 ticks.
Gold – The August gold contract is trading down at 1283.10 and is down 4 ticks from its close.
Initial Conclusion: This is not a correlated market. The dollar is up+ and oil is up+ which is not normal and the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are down and the US dollar is trading higher which is correlated. Gold is trading lower which is correlated with the US dollar trading up. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
All of Asia closed higher with the exception of the Indian Sensex. As of this writing all of Europe is trading lower.
Possible challenges to traders today is the following
1. Core CPI is out at 8:30 AM EST. This is major.
2. CPI is out at 8:30 AM EST. This is major.
3. TIC Long Term Purchases are out at 9 AM EST. This is not major.
4. Capacity Utilization Rate is out at 9:15 AM EST This is not major.
5. Industrial Production Rate is out at 9:15 AM EST. This is not major.
6. NAHB Housing Market Index is out at 10 AM EST. This is major.
7. FOMC Member George Speaks at 2:15 PM EST. This is major.
Yesterday we said our bias was to the upside as Gold was higher and Asia and Europe were both higher. The net result? The Dow Closed 20 points higher. Today we are not dealing with a correlated market and as such our bias is to the downside today. Why? The USD and crude are not correlated, Europe is trading lower and Gold is also trading lower. Could this change? Of Course. Remember anything can happen in a volatile market.
Yesterday we said our bias was to the upside and despite a not too stellar retails sales report the Dow eked out a 20 point gain. This was not bad considering Retail Sales that came in at 0.4% versus 0.7% expected. Of course the Empire State Manufacturing Index came in higher at 9.5 versus 5.2 expected. FOMC Member Tarullo spoke about Dodd-Frank implementation and did not voice a policy comment or statement which I think helped as well. The question is will we be as fortunate today as FOMC Member George speaks at 2:15 PM EST? Only time will tell...
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. As an update on this issue, last week the White House extended the employer's mandate to 2015 versus 2014 and currently the house will vote on a similar measure for individuals. The question is can you trust the folks in DC to implement anything? To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569
To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the downside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading higher and the US Dollar is advancing. This is not normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.65 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading higher and the US Dollar is advancing. This is not normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.forexcrunch.com/the-taper-caper/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
Monday, July 15, 2013
Pre-Market Global Review - 7/15/13 - The Taper Caper Continues...
Good Morning Traders,
As of this writing 4:50 AM EST, here’s what we see:
US Dollar –Up at 83.360, the Sept US Dollar is up 197 ticks and is trading at 83.360.
Energies – August Oil is down at 105.39.
Financials – The September 30 year bond is up 4 ticks and is trading at 134.02.
Indices – The September S&P 500 emini ES contract is up at 1674.25 and is up 16 ticks.
Gold – The August gold contract is trading up at 1281.10 and is up 36 ticks from its close.
Initial Conclusion: This is not a correlated market. The dollar is up+ and oil is down- which is normal and the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are up and the US dollar is trading higher which is not correlated. Gold is trading higher which is not correlated with the US dollar trading up. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
All of Asia closed higher. The Nikkei was closed for a bank holiday. As of this writing most of Europe is trading higher.
Possible challenges to traders today is the following
1. FOMC Member Tarullo Speaks at 8 AM EST. This is major.
2. Core Retail Sales is out at 8:30 AM EST. This is major.
3. Retail Sales are out at 8:30 AM EST. This is major.
4. Empire State Manufacturing Index is out at 8:30 AM EST This is major.
5. Business Inventories are out at 10 AM EST. This is not major.
On Friday we said our bias was to the downside as the markets were correlated as such. Whereas the markets spent most of the day in negative territory, at the last ten minutes or so they managed to squeak out a gain. The Dow closed higher to the tune of 3 points. Today we aren't dealing with a correlated market however out bias is to the upside today. Gold is trading higher and both Asia and Europe are trading higher. Could this change? Of Course. Remember anything can happen in a volatile market.
On Friday our bias was to the downside as the markets were correlated as such. Despite a not too stellar UOM consumer sentiment and inflation expectation number the markets squeezed a gain although not by much. Our concern on Friday was FOMC Member Bullard and what he would say. It seems that of late each time one of these members speak (regardless of stature), they have a way of moving the markets. Of course this is all predicated on what they say. Fortunately for the bulls, Bullard believes the Fed should continue with the buyback program as his concern is inflation. Apparently this was enough for the bulls to charge forward into a higher close. The question now is will we be so fortunate with Member Tarullo today? Time will tell...
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. As an update on this issue, last week the White House extended the employer's mandate to 2015 versus 2014 and currently the house will vote on a similar measure for individuals. The question is can you trust the folks in DC to implement anything? To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569 To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As
readers are probably aware I don't trade equities. While we're on
this discussion, let's define what is meant by a good earnings report. A
company must exceed their prior quarter's earnings per share and must
provide excellent forward guidance. Any falloff between earning per
share or forward guidance will not bode well for the company's shares. This is one of the
reasons I don't
trade equities but prefer futures. There is no earnings reports with
futures and we don't have to be concerned about lawsuits, scandals,
malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the upside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading lower and the US Dollar is advancing. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.36 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading lower and the US Dollar is advancing. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.forexcrunch.com/the-taper-caper/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
As of this writing 4:50 AM EST, here’s what we see:
US Dollar –Up at 83.360, the Sept US Dollar is up 197 ticks and is trading at 83.360.
Energies – August Oil is down at 105.39.
Financials – The September 30 year bond is up 4 ticks and is trading at 134.02.
Indices – The September S&P 500 emini ES contract is up at 1674.25 and is up 16 ticks.
Gold – The August gold contract is trading up at 1281.10 and is up 36 ticks from its close.
Initial Conclusion: This is not a correlated market. The dollar is up+ and oil is down- which is normal and the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are up and the US dollar is trading higher which is not correlated. Gold is trading higher which is not correlated with the US dollar trading up. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
All of Asia closed higher. The Nikkei was closed for a bank holiday. As of this writing most of Europe is trading higher.
Possible challenges to traders today is the following
1. FOMC Member Tarullo Speaks at 8 AM EST. This is major.
2. Core Retail Sales is out at 8:30 AM EST. This is major.
3. Retail Sales are out at 8:30 AM EST. This is major.
4. Empire State Manufacturing Index is out at 8:30 AM EST This is major.
5. Business Inventories are out at 10 AM EST. This is not major.
On Friday we said our bias was to the downside as the markets were correlated as such. Whereas the markets spent most of the day in negative territory, at the last ten minutes or so they managed to squeak out a gain. The Dow closed higher to the tune of 3 points. Today we aren't dealing with a correlated market however out bias is to the upside today. Gold is trading higher and both Asia and Europe are trading higher. Could this change? Of Course. Remember anything can happen in a volatile market.
On Friday our bias was to the downside as the markets were correlated as such. Despite a not too stellar UOM consumer sentiment and inflation expectation number the markets squeezed a gain although not by much. Our concern on Friday was FOMC Member Bullard and what he would say. It seems that of late each time one of these members speak (regardless of stature), they have a way of moving the markets. Of course this is all predicated on what they say. Fortunately for the bulls, Bullard believes the Fed should continue with the buyback program as his concern is inflation. Apparently this was enough for the bulls to charge forward into a higher close. The question now is will we be so fortunate with Member Tarullo today? Time will tell...
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. As an update on this issue, last week the White House extended the employer's mandate to 2015 versus 2014 and currently the house will vote on a similar measure for individuals. The question is can you trust the folks in DC to implement anything? To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569 To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the upside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading lower and the US Dollar is advancing. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.36 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading lower and the US Dollar is advancing. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.forexcrunch.com/the-taper-caper/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
Friday, July 12, 2013
Pre-Market Global Review - 7/12/13 - Taper Caper Turns Tide
Good Morning Traders,
As of this writing 5:00 AM EST, here’s what we see:
US Dollar –Up at 83.150, the Sept US Dollar is up 235 ticks and is trading at 83.150.
Energies – August Oil is down at 104.73.
Financials – The September 30 year bond is up 17 ticks and is trading at 134.24.
Indices – The September S&P 500 emini ES contract is down at 1669.00 and is down 4 ticks.
Gold – The August gold contract is trading down at 1275.10 and is down 49 ticks from its close.
Initial Conclusion: Finally we have a correlated market, unfortunately it's correlated to the downside. The dollar is up+ and oil is down- which is normal and the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are down and the US dollar is trading higher which is correlated. Gold is trading lower which is correlated with the US dollar trading up. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
Asia closed lower with the exception being the Nikkei and Indian Sensex which closed higher. As of this writing most of Europe is trading higher.
Possible challenges to traders today is the following
1. PPI is out at 8:30 AM EST. This is major.
2. Core PPI is out at 8:30 AM EST. This is major.
3. Preliminary UOM Consumer Sentiment is out at 9:55 AM EST. This is major.
4. Preliminary UOM Inflation expectation is out at 9:55 AM EST This is major.
5. FOMC Member Bullard speaks at 1 PM EST. This is major.
Yesterday we said our bias was to upside as most of the markets were correlated except the Bonds. The Net Result? The Dow gained 161 points and the other indices gained as well. Today we are dealing with a correlated market however it is correlated to the downside. As such our bias is to the down side today. It could be that after a solid week of gains the Smart Money wants to take money off the table. Could this change? Of Course. Remember anything can happen in a volatile market.
Yesterday we said the markets would go higher and they did; to the tune of triple digits for the Dow. This was despite a not too stellar Unemployment Claims number that showed an increase in claims. It would appear as though Mr. Bernanke's comments concerning not being in a rush to raise short term interest rates did the trick. Today we have FOMC Member Bullard speak at 1 PM EST and hopefully he will continue Bernanke's rhetoric concerning interest rates.
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act.
As an update on this issue, last week the White House extended the employer's mandate to 2015 versus 2014 and currently the house will vote on a similar measure for individuals. The question is can you trust the folks in DC to implement anything?
To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569
To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As
readers are probably aware I don't trade equities. While we're on
this discussion, let's define what is meant by a good earnings report. A
company must exceed their prior quarter's earnings per share and must
provide excellent forward guidance. Any falloff between earning per
share or forward guidance will not bode well for the company's shares. This is one of the
reasons I don't
trade equities but prefer futures. There is no earnings reports with
futures and we don't have to be concerned about lawsuits, scandals,
malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the downside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading lower and the US Dollar is advancing. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.31 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading lower and the US Dollar is advancing. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
As of this writing 5:00 AM EST, here’s what we see:
US Dollar –Up at 83.150, the Sept US Dollar is up 235 ticks and is trading at 83.150.
Energies – August Oil is down at 104.73.
Financials – The September 30 year bond is up 17 ticks and is trading at 134.24.
Indices – The September S&P 500 emini ES contract is down at 1669.00 and is down 4 ticks.
Gold – The August gold contract is trading down at 1275.10 and is down 49 ticks from its close.
Initial Conclusion: Finally we have a correlated market, unfortunately it's correlated to the downside. The dollar is up+ and oil is down- which is normal and the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are down and the US dollar is trading higher which is correlated. Gold is trading lower which is correlated with the US dollar trading up. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
Asia closed lower with the exception being the Nikkei and Indian Sensex which closed higher. As of this writing most of Europe is trading higher.
Possible challenges to traders today is the following
1. PPI is out at 8:30 AM EST. This is major.
2. Core PPI is out at 8:30 AM EST. This is major.
3. Preliminary UOM Consumer Sentiment is out at 9:55 AM EST. This is major.
4. Preliminary UOM Inflation expectation is out at 9:55 AM EST This is major.
5. FOMC Member Bullard speaks at 1 PM EST. This is major.
Yesterday we said our bias was to upside as most of the markets were correlated except the Bonds. The Net Result? The Dow gained 161 points and the other indices gained as well. Today we are dealing with a correlated market however it is correlated to the downside. As such our bias is to the down side today. It could be that after a solid week of gains the Smart Money wants to take money off the table. Could this change? Of Course. Remember anything can happen in a volatile market.
Yesterday we said the markets would go higher and they did; to the tune of triple digits for the Dow. This was despite a not too stellar Unemployment Claims number that showed an increase in claims. It would appear as though Mr. Bernanke's comments concerning not being in a rush to raise short term interest rates did the trick. Today we have FOMC Member Bullard speak at 1 PM EST and hopefully he will continue Bernanke's rhetoric concerning interest rates.
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act.
As an update on this issue, last week the White House extended the employer's mandate to 2015 versus 2014 and currently the house will vote on a similar measure for individuals. The question is can you trust the folks in DC to implement anything?
To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569
To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the downside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading lower and the US Dollar is advancing. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.31 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading lower and the US Dollar is advancing. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
Thursday, July 11, 2013
Pre-Market Global Review - 7/11/13 - The Taper Caper
Good Morning Traders,
As of this writing 4:45 AM EST, here’s what we see:
US Dollar –Down at 83.145, the Sept US Dollar is down 219 ticks and is trading at 83.145.
Energies – August Oil is up at 106.79.
Financials – The September 30 year bond is up 37 ticks and is trading at 134.02.
Indices – The September S&P 500 emini ES contract is up at 1665.00 and is up 67 ticks.
Gold – The August gold contract is trading up at 1284.60 and is up 376 ticks from its close.
Initial Conclusion: This is a nearly correlated market. The dollar is down- and oil is up+ which is normal but the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are up and the US dollar is trading lower which is correlated. Gold is trading higher which is correlated with the US dollar trading down. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
All of Asia closed higher with some exchanges closing higher to the tune of triple digits. As of this writing all of Europe is trading higher.
Possible challenges to traders today is the following
1. Unemployment Claims are out at 8:30 AM EST. This is major.
2. Import/Export Prices are out at 8:30 AM EST. This is not major.
3. Natural Gas Storage is out at 10:30 AM EST. This will move the Nat Gas market.
4. FOMC Member Tarullo speaks at 11 AM EST. This is major.
5. 30 Year Bond Auction starts at 1 PM EST
6. Federal Budget Balance is out at 2 PM EST. This could have an impact on afternoon trading.
Yesterday we said our bias was to upside as most of the markets were correlated except the Bonds. We also mentioned that the FOMC minutes would have an impact on the markets and they did. The Dow dropped 8 points but the other indices closed higher. Today we are dealing with a nearly correlated market with the exception being Bonds. If Bonds were trading lower I would say we had a correlated market, this not withstanding our bias is to upside today. Why? The US Dollar is trading lower, Gold is up and Europe is trading higher. Could this change? Of Course. Remember anything can happen in a volatile market.
Yesterday started off as expected with the markets initially gaining ground in the morning but then remained flat until 2 PM when the FOMC meeting minutes were revealed. It turns out that about half the committee wanted QE program to end later this year and some wanted it to end immediately. At first the markets applauded the news by trading higher. As I mentioned a couple days ago the institutionals want higher interest rates as it means more passive income for them. Who cares if John Q. Public has to pay more for a house or car? That won't affect us, right? Well I guess this realization must have struck a cord because the Dow did close lower. Not by much mind you, but it did close lower. Bernanke's speech at 4:10 PM was only to recognize the 100th anniversary of the Federal Reserve. He did mention that the "Fed was in no hurry to raise short term interest rates even after the Unemployment and inflation thresholds were met". So now the great guessing game begins, with the key issue being when will the Fed taper? My own personal guess is sometime next year with a better economy than we have now. One economist commented that the Fed tapering off of QE is liken to shooting the economy in the foot. I would have to agree but then again that is the "Taper Caper"....
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569 To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As readers are probably aware I don't trade equities. While we're on this discussion, let's define what is meant by a good earnings report. A company must exceed their prior quarter's earnings per share and must provide excellent forward guidance. Any falloff between earning per share or forward guidance will not bode well for the company's shares. This is one of the reasons I don't trade equities but prefer futures. There is no earnings reports with futures and we don't have to be concerned about lawsuits, scandals, malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the upside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading higher and the US Dollar is declining. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.33 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading higher and the US Dollar is declining. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
As of this writing 4:45 AM EST, here’s what we see:
US Dollar –Down at 83.145, the Sept US Dollar is down 219 ticks and is trading at 83.145.
Energies – August Oil is up at 106.79.
Financials – The September 30 year bond is up 37 ticks and is trading at 134.02.
Indices – The September S&P 500 emini ES contract is up at 1665.00 and is up 67 ticks.
Gold – The August gold contract is trading up at 1284.60 and is up 376 ticks from its close.
Initial Conclusion: This is a nearly correlated market. The dollar is down- and oil is up+ which is normal but the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are up and the US dollar is trading lower which is correlated. Gold is trading higher which is correlated with the US dollar trading down. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
All of Asia closed higher with some exchanges closing higher to the tune of triple digits. As of this writing all of Europe is trading higher.
Possible challenges to traders today is the following
1. Unemployment Claims are out at 8:30 AM EST. This is major.
2. Import/Export Prices are out at 8:30 AM EST. This is not major.
3. Natural Gas Storage is out at 10:30 AM EST. This will move the Nat Gas market.
4. FOMC Member Tarullo speaks at 11 AM EST. This is major.
5. 30 Year Bond Auction starts at 1 PM EST
6. Federal Budget Balance is out at 2 PM EST. This could have an impact on afternoon trading.
Yesterday we said our bias was to upside as most of the markets were correlated except the Bonds. We also mentioned that the FOMC minutes would have an impact on the markets and they did. The Dow dropped 8 points but the other indices closed higher. Today we are dealing with a nearly correlated market with the exception being Bonds. If Bonds were trading lower I would say we had a correlated market, this not withstanding our bias is to upside today. Why? The US Dollar is trading lower, Gold is up and Europe is trading higher. Could this change? Of Course. Remember anything can happen in a volatile market.
Yesterday started off as expected with the markets initially gaining ground in the morning but then remained flat until 2 PM when the FOMC meeting minutes were revealed. It turns out that about half the committee wanted QE program to end later this year and some wanted it to end immediately. At first the markets applauded the news by trading higher. As I mentioned a couple days ago the institutionals want higher interest rates as it means more passive income for them. Who cares if John Q. Public has to pay more for a house or car? That won't affect us, right? Well I guess this realization must have struck a cord because the Dow did close lower. Not by much mind you, but it did close lower. Bernanke's speech at 4:10 PM was only to recognize the 100th anniversary of the Federal Reserve. He did mention that the "Fed was in no hurry to raise short term interest rates even after the Unemployment and inflation thresholds were met". So now the great guessing game begins, with the key issue being when will the Fed taper? My own personal guess is sometime next year with a better economy than we have now. One economist commented that the Fed tapering off of QE is liken to shooting the economy in the foot. I would have to agree but then again that is the "Taper Caper"....
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569 To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As readers are probably aware I don't trade equities. While we're on this discussion, let's define what is meant by a good earnings report. A company must exceed their prior quarter's earnings per share and must provide excellent forward guidance. Any falloff between earning per share or forward guidance will not bode well for the company's shares. This is one of the reasons I don't trade equities but prefer futures. There is no earnings reports with futures and we don't have to be concerned about lawsuits, scandals, malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the upside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading higher and the US Dollar is declining. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 104.33 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $103 a barrel and resistance at 108. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading higher and the US Dollar is declining. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10 AM when the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
Wednesday, July 10, 2013
Pre-Market Global Review - 7/10/13 - Off to a Good Start
Good Morning Traders,
As of this writing 5:20 AM EST, here’s what we see:
US Dollar –Down at 84.485, the Sept US Dollar is down 296 ticks and is trading at 84.485.
Energies – August Oil is up at 104.78.
Financials – The September 30 year bond is up 3 ticks and is trading at 133.18.
Indices – The September S&P 500 emini ES contract is down at 1643.75 and is down 7 ticks.
Gold – The August gold contract is trading up at 1251.90 and is up 60 ticks from its close.
Initial Conclusion: This is not correlated market. The dollar is down- and oil is up+ which is normal but the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are up and the US dollar is trading higher which is not correlated. Gold is trading higher which is correlated with the US dollar trading down. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
Asia closed higher with the exception of the Nikkei and Indian Sensex. As of this writing all of Europe is trading lower.
Possible challenges to traders today is the following
1. Wholesale Inventories are out at 10 AM EST. This is not major.
2. Crude Inventories are out at 10:30 AM EST. This will move the oil markets.
3. 10 Year Bond Auction starts at 1 PM EST. This can move the Bond markets.
4. FOMC Meeting Minutes are out at 2 PM EST. This is major.
5. Chairman Bernanke speaks at 4:10 PM EST. This is major.
Yesterday we said our bias was to upside as the Bonds were lower and Europe was trading much higher. The Net Result? The Dow gained 75 points and the other indices gained as well. Today we are not dealing a correlated market however our bias is to the upside. Why? The USD is trading lower and the Bonds are trading slightly higher plus Gold is trading higher. Could this change? Of Course. Remember anything can happen in a volatile market.
This was a good start to the earnings season as apparently the Alcoa earnings didn't phase the markets at all. I originally thought this might have a negative impact but apparently not. All boats seemed to lift higher yesterday as all indices fared well. Today in the afternoon we have the 10 year bond auction, the FOMC meeting minutes and Bernanke speaking after 4 PM when the markets close. He's probably going to address the meeting minutes and I just hope he does a better job this time around. The markets could go in either direction today with the mindset being "let's make our money today and then worry about Bernanke later" or they could be sitting on their hands waiting for him to speak. I just hope he sticks to the schedule and not talk during trading hours as that would be a major distraction...
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569 To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As readers are probably aware I don't trade equities. While we're on this discussion, let's define what is meant by a good earnings report. A company must exceed their prior quarter's earnings per share and must provide excellent forward guidance. Any falloff between earning per share or forward guidance will not bode well for the company's shares. This is one of the reasons I don't trade equities but prefer futures. There is no earnings reports with futures and we don't have to be concerned about lawsuits, scandals, malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the upside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading higher and the US Dollar is declining. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 102.31 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $102 a barrel and resistance at 105. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading higher and the US Dollar is declining. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10:30 AM when the inventory numbers are released and the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
As of this writing 5:20 AM EST, here’s what we see:
US Dollar –Down at 84.485, the Sept US Dollar is down 296 ticks and is trading at 84.485.
Energies – August Oil is up at 104.78.
Financials – The September 30 year bond is up 3 ticks and is trading at 133.18.
Indices – The September S&P 500 emini ES contract is down at 1643.75 and is down 7 ticks.
Gold – The August gold contract is trading up at 1251.90 and is up 60 ticks from its close.
Initial Conclusion: This is not correlated market. The dollar is down- and oil is up+ which is normal but the 30 year bond is trading higher. The Financials should always correlate with the US dollar such that if the dollar is lower then bonds should follow and vice versa. The indices are up and the US dollar is trading higher which is not correlated. Gold is trading higher which is correlated with the US dollar trading down. I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open.
Asia closed higher with the exception of the Nikkei and Indian Sensex. As of this writing all of Europe is trading lower.
Possible challenges to traders today is the following
1. Wholesale Inventories are out at 10 AM EST. This is not major.
2. Crude Inventories are out at 10:30 AM EST. This will move the oil markets.
3. 10 Year Bond Auction starts at 1 PM EST. This can move the Bond markets.
4. FOMC Meeting Minutes are out at 2 PM EST. This is major.
5. Chairman Bernanke speaks at 4:10 PM EST. This is major.
Yesterday we said our bias was to upside as the Bonds were lower and Europe was trading much higher. The Net Result? The Dow gained 75 points and the other indices gained as well. Today we are not dealing a correlated market however our bias is to the upside. Why? The USD is trading lower and the Bonds are trading slightly higher plus Gold is trading higher. Could this change? Of Course. Remember anything can happen in a volatile market.
This was a good start to the earnings season as apparently the Alcoa earnings didn't phase the markets at all. I originally thought this might have a negative impact but apparently not. All boats seemed to lift higher yesterday as all indices fared well. Today in the afternoon we have the 10 year bond auction, the FOMC meeting minutes and Bernanke speaking after 4 PM when the markets close. He's probably going to address the meeting minutes and I just hope he does a better job this time around. The markets could go in either direction today with the mindset being "let's make our money today and then worry about Bernanke later" or they could be sitting on their hands waiting for him to speak. I just hope he sticks to the schedule and not talk during trading hours as that would be a major distraction...
On Friday, June 7th I had the opportunity to interview Mr. Sal Spedele regarding ObamaCare. Sal is a 20 year veteran of the Insurance Industry and we spoke at length regarding the ramifications of the Patient Protection and Affordable Care Act aka ObamaCare. If you are at all concerned about the future of Health Insurance in the United States, then you need to listen to this interview and act on it. Sal and his team is offering complimentary advisory services to inform you of your rights and ramifications of this Act. To download the article on ObamaCare, go to: https://markettealeaves.sharefile.com/d/s978a806ae2e41569 To view my discussion with Sal: http://youtu.be/sR_ine0b5Ro
As readers are probably aware I don't trade equities. While we're on this discussion, let's define what is meant by a good earnings report. A company must exceed their prior quarter's earnings per share and must provide excellent forward guidance. Any falloff between earning per share or forward guidance will not bode well for the company's shares. This is one of the reasons I don't trade equities but prefer futures. There is no earnings reports with futures and we don't have to be concerned about lawsuits, scandals, malfeasance, etc.
Anytime the market isn't correlated it's giving you a clue that something isn't right and you should proceed with caution. Today our bias is to the upside. Could this change? Of course. In a volatile market anything can happen. We'll have to monitor and see.
In May, I spoke with John Karnas, CEO of Trend Following Trades. John has an interesting background as he was a trader for a number of years prior to buying Trend Following Trades. John is a believer in Trading Plans and has a very precise method of developing aspiring traders. To download the article I've written, go to:
https://markettealeaves.sharefile.com/d/sdf8f77f6e2c4347a
My discussion with John can be viewed at: http://youtu.be/uVwHpMq1604
Please note the video is about a half hour in length and we plan on producing more in the near future. Also note that in the near future we will have other videos where we will interview various trading leaders.
As I write this the crude markets are trading higher and the US Dollar is declining. This is normal. Think of it this way. If the stock market is trading lower, it's safe to assume that the crude market will follow suit and vice versa. Crude trades with the expectation that business activity is expanding. The barometer of which is the equities or stock market. If you view both the crude and index futures side by side you will notice this. Yesterday August crude dropped to a low of 102.31 a barrel and held. We'll have to monitor and see if crude either goes lower or holds at the present level. It would appear at the present time that crude has support at $102 a barrel and resistance at 105. This could change. All we need do is look at what happened last fall when crude was trading over $100.00 a barrel. We'll have to monitor and see. Remember that crude is the only commodity that is reflected immediately at the gas pump.
Future Challenges:
- Budget Battle - ongoing.
- Debt Ceiling in the August time frame.
- Asian Contagion - happening now
Crude oil is trading higher and the US Dollar is declining. This is normal. Crude typically makes 3 major moves (long or short) during the course of any trading day: around 7 AM EST, 9 AM EST and 2 PM EST when the crude market closes. If crude makes major moves around those time frames, then this would suggest normal trending, if not it would suggest that something is not quite right. If you feel compelled to trade consider doing so after 10:30 AM when the inventory numbers are released and the markets give us better direction. As always watch and monitor your order flow as anything can happen in this market. This is why monitoring order flow in today's market is crucial. We as traders are faced with numerous challenges that we didn't have a few short years ago. High Frequency Trading is one of them. I'm not an advocate of scalping however in a market as volatile as this scalping is an alternative to trend trading.
Recently Published Articles:
http://www.barchart.com/headlines/story/10598425/when-perception-becomes-reality
http://www.forexcrunch.com/good-jobs-report/
http://www.traderslog.com/john-karnas/
Remember that without knowledge of order flow we as traders are risking our hard earned capital and the Smart Money will have no issue taking it from us. Regardless of whatever platform you use for trading purposes you need to make sure it's monitoring order flow. Sceeto does an excellent job at this. To fully capitalize on this newsletter it is important that the reader understand how the various market correlate. More on this in subsequent editions.
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