Thursday, October 24, 2013

Morning Prep 10/24/13;

7:30am EST

Focus-Points this morning:
·       Japan Govt cuts exports expectations for the second straight month as Asian markets appear to be cooling
·       Major European PMI numbers come in lower than expected, France hits 20-months of decline in Manufacturing
·       US Equities waiting for big earning reports today from Colgate, Ford, Dow, Xerox, etc.
·       EUR/USD hits fresh 2-year highs above 1.3800
·       Gold is higher +.45%
·       Crude Oil is higher +.45%
·       EUR is higher +20%
·       30 Bonds are lower -.35%
·       E-Mini S&P is lower -.50%

Economic News on the schedule today:
8:30am EST:             International Trade
8:30am EST:             Jobless Claims
8:58am EST:             PMI Manufacturing Index
10:00am EST:           JOLTS Report

Today’s news is all about jobs.  Jobless Claims will offer the latest numbers on how many people are filing for un-employment benefits this week, while the JOLTS report will tell us how many job openings there were this week.

Jobless Claims: 
Initial jobless claims for the October 12 week eased 15,000 to 358,000. This followed a surge of 65,000 the week before. Temporary layoffs in the private sector tied to the government shutdown as well as extended distortions tied to a backlog problem in California continued to skew higher initial jobless claims. Reflecting the last two weeks of sharply higher readings, the 4-week average was up 11,750 to 336,500 which was more than 20,000 higher than the month-ago comparison. But with the government shutdown now past and with the backlog in California likely to ease, initial claims may very well begin coming back down in the reports ahead.


The Labor Department's Job Openings and Labor Turnover Survey in July showed that jobs were harder to find that month. There were 3.689 million job openings on the last business day of July, down marginally from June at a revised 3.869 million. The job openings rates slipped to 2.6 percent from 2.8 percent in June. This release is produced by the Labor Department and the scheduled release time may be affected by federal government budget issues.

Price levels to watch this morning:

Euro Currency Futures:
VAH 3794 / VAL 3776
PHOD 3795 / PLOD 3751
Bullish = Open > 3795
Bearish = Open < 3751

Euro VIP Chart
The Euro traded mostly sideways on Wednesday, inside the range from Tuesday and closing the session right in the middle of the day’s range.

This type of price-action suggests that the market was balanced when we finished trading on Wednesday and the very narrow range tells us to expect a wider range in today’s session, so look for the breakouts and the runner.

In pre-market trading this morning we are at 3805 so we can assume the opening-print will be bullish above the PHOD at 3794 which means we are looking for buying opportunities up to the targets at 3807, 3822, and 3866
Targets above:        3807, 3822, 3866
Targets below:        3794, 3786, 3776, 3751, 3739, 3736

Gold Futures:
VAH 1335.8 / VAL 1332.3
PHOD 1337.3 / PLOD 1329.6
Bullish = Open > 1337.3
Bearish = Open < 1329.6

Gold VIP Chart
Gold traded in a very narrow range on Wednesday, inside the range from Tuesday and just above the previous week’s highs. 

The narrow trading-range, along with a closing-print in the middle of the range tells us this market was balanced going into the close of trading yesterday.
This morning we will expect to see a breakout of this trading-range with a test of the highs at 1344.7 or the lows at 1312.9.  We will be watching the opening-bell closely to look for clues in which direction we are going to breakout. 

In pre-market trading Gold is at 1340.0 which is above the PHOD at 1337.3 so it appears we will have a bullish opening-print and buying opportunities up to 1344.7 today, however we will follow our plan to wait patiently until we see how the price-action looks at 820am EST.
Targets above:        1339.5, 1342.1, 1344.7, 1348.5, 1349.8
Targets below:        1335.8, 1333.9, 1332.3, 1328.8, 1327.3, 1324.6, 1316.8, 1312.9

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Crude Oil Futures:
VAH 97.08 / VAL 96.32
PHOD 97.45 / PLOD 96.16
Bullish = Open > 97.45
Bearish = Open < 96.16

Crude Oil VIP Chart
Crude Oil continued its slide on Wednesday with a slightly sideways type of day and a narrow trading-range around the 97.00 big-round-number.

The range on Wednesday was relatively narrow for Crude Oil price-action, and the closing-print in the middle of the range tells us that we finished the session well-balanced.

As we look at pre-market trading this morning we see Crude Oil prices around the 97.00 big-round-number which suggests that we will have an opening-print inside the range from Wednesday so we will expect to see 2-sided trading at 900am EST when the opening-bell rings.  We will be looking for clues from the price-action at the opening-bell to see who grabs control over price.
Targets above:        97.45, 97.73, 97.96, 98.15, 98.25, 98.66
Targets below:        96.76, 96.32, 96.16, 96.03, 95.81, 95.36, 95.24, 94.31

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E-Mini S&P Futures:
VAH 1741.75 / VAL 1738.25
PHOD 1744.00 / PLOD 1734.50
Bullish = Open > 1744.00
Bearish = Open < 1734.50

E-Mini ES VIP Chart
The E-Mini S&P traded sideways on Wednesday with a normal trading-range and a closing-print near the highs of the range, suggesting that the market sentiment had turned bullish towards the end of the session.

This morning we see pre-market trading is around 1747.00 which suggests a bullish opening-print at 930am EST when the opening-bell rings.
If we open above the 1744.00 we will start buying up to targets above us at 1745.50, 1746.50, 1748.50, and 1751.00
Targets above:        1745.50, 1746.50, 1748.50, 1751.00, 1754.50
Targets below:        1741.50, 1729.75, 1738.25. 1734.75, 1732.25

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