Wednesday, December 01, 2010

Emini Futures / Markets Higher On New Strain Of Hintavirus


from the trading desk of CFRN...  

Wow!  What a difference a day makes...We started out fairly quiet, but with a fairly good trend line up.  The Euro Zone debt “crisis” has started to look contained by steps such as the potential Budgetary Advisory Council for Ireland, Structural Reforms for Portugal and Spain and IMF potential Commitments just to name a few.  Stability for each debt crisis event keeps the impact of the circumstance from whirling out of control.  As long as we can address each individually and with the support of the IMF, the Fed and the Euro Zone; we still allude to containment as far as sentiment goes. 

On the home front, we had a slightly lower ISM Index of 56.6 vs 56.9 in October.  US October Construction Spending was up 0.7%. China had some positive economic reports as well boosting the recovery hopes.  

The way the bulls took control today, showed some strength and technically paints an optimistic look for tomorrow.  Technically, the US Dollar had a nice run in November, but possibly needs to consolidate or retrace somewhat. The US Dollar often trades inversely to other markets. The weaker dollar today also helped to set the bullish stage. The Euro FX remained in a fairly tight range on apprehensions which still abound in Europe, but the US has a tremendous resilience and ability to shrug-off fear and uncertainty in the market. 

The high of the day was $1207.75, while the low was $1176.25 totally breaking out of the range from yesterday and the downward trend from the 12th. The CFRN Weekly Trading Zone $1178 - $1179 held the market captive in a 1 point range for 6 hours on Globex until ECB President Trichet hinted the ECB stands ready to do more. The pivotal word is hinted. He didn't sign anything, do anything, or even suggest anything. He hinted. A new term for the European Contagion may be the Hintavirus. Similar in many respects to it's not so distant relative the Hantavirus. For those of you not familiar, Hantavirus is carried by rodents, especially deer mice. The virus is in their urine and feces, but it does not make the carrier animal sick. Humans are thought to become infected when they are exposed to contaminated dust from mice nests or droppings. If you don't follow my ill conceived logic or tasteless analogy, worry not... Glen Beck will be drawing you a chart soon enough.

After the 20 point gap opening today, our Weekly Zone $1200.00 - $1201.00 held for 2 hours of consolidation and allowed buyers time to catch a second wind and close out a trend up day just off the highs.

US Economic Reports out Thursday:
Initial Jobless Claims  -  7:30 AM CST. (High Impact)  

The trend is now up! $1198.00 appears to be a point of control or comfort zone for the market. We look for a potential higher day and are prepared to buy any potential dips. Large moves are often followed by consolidation days so be prepared to catch the train as it leaves the station or you may end up with a trading day better spent fishing.

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