Wednesday, November 10, 2010

Emini Futures Trading / Jobless Claims Drop And Market Follows


from the trading desk of CFRN... 

Our $1225.00 Cap has held like a champ so far! Round 5 and the E-Mini S&P 500 has not penetrated our alleged cap at $1225.00! The Initial Jobless Claims Report showed a drop by 24,000 to 435,000. At 9:05 CST AM, we were at $1201.75 rising to $1217.00 by 1:15 CST PM. This report renews hope in our economic recovery, but dims the Fed’s action regarding further stimulus injections. Without further stimulus or withdrawals from previous stimulus numbers, we may see a stronger US Dollar.

President Obama is currently under scrutiny regarding the Fed’s plans as he attends the G20 Meeting in South Korea. One of the key issues was the other countries view of a weaker US Dollar. Certainly the weaker dollar helped US Export numbers and therefore aided in the recovery, but in terms of fair trade practices with our foreign neighbors, it is not beneficial to them. The tensions that may rise abroad are of concern to us as the G20 must have cohesion to operate as a successful organization. They are also under scrutiny as well, as the global economic community decides how effective the G20 is.

Fears about Ireland was positive to the German Bund as investors shifted funds from the Euro FX. Often traders will look at the Euro FX to determine their action in the E-Mini S&P 500. The stronger US Dollar Index and the weaker Euro FX keep traders nervous to hold any longs for any extended length of time.

We stayed within CFRN’s Weekly Trade Zone of $1219.00 - $1220.00, $1215.00 and $1207.00 - $1208.00. Of particular interest is the 1207/1208 area which has provided support thus far on Globex tonight.

Tomorrow is Veteran’s Day! Foreign Exchange and Interest Rate Futures are closed.

We would like to take this opportunity to express our gratitude to all the brave men and women who have served our country. Thank You!

Only two people have ever offered to die for me -
Jesus Christ and an American Soldier.

The trend remains up, but traders await direction from the US Dollar. A stronger dollar could pressure many of the tangible markets such as the E-Mini S&P 500, the Metals and Energies. $1211.00 appears to be a point of control or comfort zone for the market. Should we breach the $1225.00 zone, our CFRN Weekly Trade Zone gives us $1227.00, $1231.00 - $1232.00. If we stay capped, our CFRN Weekly Trade Zones are $1219.00 - $1220.00, $1215.00, $1207.00 - $1208.00. Any momentum could take us back to CFRN’s Weekly Trade Zone of $1195.00 - $1196.00. Veteran’s Day may be light in volume. Erratic trading may create more choppy trading. If any sizeable fund managers decide to trade numbers, the market is vulnerable to a substantial move. It will be a good day to trade the channel formed. $1225.00 penetration could possibly give this market some legs, on the other hand below $1200.00 can start some liquidation. Breakout trading does not work well in many market conditions, but when stuck in a channel, it can be helpful.

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