Trade Desk Client Note
Global Futures Review
Gold Moves On Fed Talk
Latest Market Alerts:
- FOMC member Evans said today that "Fed policy was not a driver of the commodity price surge." and in response XAU valuations moved gold from 1790 to 1830. Good luck to all if those who control the printing press are not aware/concerned that manipulative open market policy is the cause of inflationary pressures that are far from transitory. You really could not make this up, could you?
The same way that main stream media are asking us to believe that somebody gets an idea in his bathtub on a Wednesday and by Friday morning has completed a $5 billion deal. Really? That is either one heck of a time frame to work in, or somebody is telling porkie pies. It is reminiscent of George Orwell's Animal Farm, where everybody is equal, but some animals are more equal than others.
- The Euro-zone short selling ban has not stopped the German Dax from dropping toward the 5600 precipice. Initial support is at 5550 and 5480. Our Client Note yesterday noted that the path of least resistance would be USD buying in the near term, and that is what traders saw today. The next shoe to drop may be S&P 500 trade failing to breach 1205 resistance. Full detail and signals to follow.
- Equity indices cash markets moved higher on extremely low volume, allowing the dollar and bullion markets to find sellers.
There is risk in trusting these moves to hold, but if another session can keep S&P 500 above 1195 this week a move towards 1225 may be on the cards. A break and close below 1195 draws in 1175 and 1150.
- Traders will be watching the 10-year Treasury Futures contract ZNU1 and a break above 130.40, which would signal ES (S&P 500) weakness. ES has initial 1150 support, which could then be followed by a move to 1110. Upside resistance will be found at 1205.
- There are no long-sided equity participants of note, and when compared to downside volume rallies the upside pushes are anemic. As August started we warned those who were not akin to shorting stocks to get to cash, and that mandate still holds. We noted that equities would struggle to rise unless XLF, the financial ETF, closed a week above 13.50. The pattern for stock traders is to stair-step up and take the elevator down.
- The markets are not broken, as some reports would have us believe; the markets are reflecting a broken 4-year economic trial that failed to produce growth. The normal pattern of trade has no room for long-term investors, unless they are prepared to sit out some sickening ups and downs. Short-term outlooks, near-term targets, making use of cash, and controlling exposure and risk are standard precautions each day.