Trade Recommendations for Tues. Mar. 23rd

Hello All,
 
Surpisingly the healthcare bill passed, and it seems as though the negative speculation was already baked into the cake on Friday.  For a fairly low volume day, healthcare stocks gave the market a boost, and the short covering rally pushed most markets higher.  Aside from the April Crude contract expiring, I cannot associate the strength in oil to anything fundamental.  By initially putting in a new low, technical research has us pressing against upper resistance, and we should have confirmation by morning on whether the strength shall continue into Thursday, or we'll see slight new lows across the board prior to a more significant rally.  The conflicting pattern is within the Euro as it did not show as much strength as the outside markets.  Could it be a trap?  We always have to keep an eye on the weaker sister, as one bad apple can rot the entire basket.  We have our weekly API data due tomorrow, and DOE on Wednesday, estimates are for a rise of 1.2 million barrels, continuing to increase our stockpiles.  The market seems not to be driven by fundamentals, rather investors chasing profit.  With the price of money remaining cheap, black gold will remain supported.  We've had an average price of about $75 per barrel since last summer, and I feel this level needs to be tested once more before we're off to new highs. 
 
Let's see what the financial markets will do overnight, and we will probably jump aboard the trend early morning.
 
Best,

Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk off loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Fri. Mar. 19th

Hello All,
 
Obama signs the jobs bill and our dollar strengthens.  Commodities were lower as they became more costly for holders of foreign currencies.  And tomorrow is triple witching day where stock index futures, stock index options, and stock options expire on the same day.  You can usually expect added volatility as institutional investors shuffle around positions in their portfolios.
 
1)  Sell June Emini S&P at the market (1161), with a 1172 stop.  Exit Monday.  Volatility has been low as of late and if one were to bet on increased volatility then it would be associated with downward/corrective action.  And the downward pressure will prevent call sellers from paying up at expiration.  We can also note that they are to vote on the healthcare bill as early as Sunday, so many investors may take their money off the table until we see what happens with the bill first time around.
 
2)  Sell June Euro at 1.3636, with a 1.3687 stop.  Exit Monday.  Further concerns with Greece as they are notioning that they would request assistance from the IMF if the EU leaders cannot setup a lending facility at a summit next week.  The weakness in the Euro will continue to resonate in outside markets.

3)  Sell May Crude at the market (82.36), with a 83.30 stop.  Exit Monday.  April expiration is on Monday so we'll roll to May which is trading roughly 30 cents higher.  Crude was lower for the first day after 3 sessions, but it did hold its ground with respect to the strength in the dollar.  Crude inventories have risen to the highest level of 344 million barrles since August and demand had the biggest 1 week drop (4.2%) since Nov.
 
4)  Sell April Gold at the market (1124.4), with a 1133 stop.  Exit Monday.  Additional strength in the dollar should weigh heavily on metals.  Lower channel support is just above 1100, so its possible to get a hefty decline tomorrow through Sunday.
 
Best,
 
Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk of loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Wed. Mar. 17th

Hello All,
 
Rates unchanged and not too hawkish with regards to the verbage.  The Fed believes our economy has not sustained enough growth to warrant higher rates.  If we're not having enough growth, why is that commodity prices could rise?  Easy answer.  Low rates are fueling investments across the board.  It takes money to make money, and the institutions will continue to buy buy buy.  Crude was the eye opener of the day and is retesting highs once again with OPEC meeting today with respect to production.  The speculation with OPEC has been factored into todays rally, and the key factor will be tomorrows DOE data..  API data showed a rise of 400k barrels, while analysts expected a rise of 1.9m barrels.  It seems as though they want to take out all the stops above before making a bigger fall.  Overall we should have a fairly volatile Wed. with PPI and crude inventory data out in the morning.  Exit all positions and observe for the time being.  If the Euro can squeeze above 1.3810 then we would be headed for 1.3950 which would coincide with ES around 1175, and crude around 84.  Emergency plans to help out EU members were put in place, which helped fuel support in the Euro.  But now that the emergency plan is in place, who will be the first to ask for assistance? We'll just have to wake up one of these mornings to find out!
 
Best,
 
Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk of loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Tues. Mar. 16th

Hello All,
 
It seems as though our analysis is correct and the markets are topping on schedule.  We have our FOMC rate decision tomorrow around 11:15am PST, and although it's fair to say that the rates will remain unchanged, the focus will be on the verbage of the minutes.  Rates have remained near 0 since Dec. 2008, and with the given economic recovery it is only a matter of time before we really have to jumpstart the capital markets by getting interbank lending on its own feet.  Could we be in store for rate hike verbage as early as the next meeting(April 27th)?  As soon as they decide to drop the phrase "extended period", it would be extremely dollar bullish.  My assumption is that tomorrows reaction will be in support of the dollar with continued hawkish speculation, which will continue to pressure commodities and foreign currencies.  If that is the case, then we can see continued downward pressure in 3 waves through April 20th, with a slight corrective rally March 25th-30th.
 
1)  Sell June Emini S&P at 1154.00, with a 1165.75 stop.  Exit to be determined.
 
2)  Hold April Crude oil shorts from 81.12.  Use a 81.15 protective stop.  Exit 77.00.  She's the leader, so watch her take out the low of the day and the surrounding markets will tumble.  It's funny how 'now' they realize demand isn't keeping up.  Reactions are either too quick or too slow nowadays.
 
3)  Sell June Euro at 1.3720, with a 1.3766 stop.  Exit 1.3488.  The market should remain steady going into the report, and then we should see a sell the fact reaction.  And surprisingly, I anticipate we will continue to be rangebound for at least another week or two before descending to new lows.
 
Best,

 
Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk of loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Fri. Mar. 12th

Hello All,
 
I'm glad we didn't place any trades today as their wasn't much going on, we would have been sitting ducks.  The markets were little changed with a stable dollar after government reports showed that the trade deficit narrowed, indicating a slowing economic recovery.  We've been covering the same ground for the past 3 days and we're close to topping.  The FOMC minutes may be the catalyst to push these markets lower, so there is still the possibility of making new highs into Sunday/Monday.
 
1)  June Emini S&P probably will be stagnant in the 1140-1150 region.  Not worth trading tomorrow, but if you must you should be trading from the longside just in case the market takes off to end the week at a new high.
 
2)  Buy June Euro at 1.3670, with a 1.3604 stop.  Exit 1.3782.  The march currency contracts are expiring on Monday and major rollover took place today with a huge spike in volume.  The market has put in a bowl type of bottom and we'll have to see how she reacts to resistance at 1.38 going into the FOMC meeting.  But I suspect the announcement will be bullish for the dollar and inversely send all related markets lower after Tuesday.
 
3)  Sell April Crude on a stop at 81.12, with a 82.45 protective stop.  The market has respected the uptrend channel since the beginning of Feb. and as soon as we breach it look out below.  We've been in a congestion pattern which should come to a climax tomorrow.  If we break above 83 then we may very well see the 85 region for a double top before we descend back below 75.  If we cannot get a rally above 83 by Sunday then the market should be heading straight for 77, then a minor bounce to 81, before ultimately heading towards 70-72.  Along with the FOMC meeting on Tuesday, we have crude option expiration on Wednesday along with another inventory report, so it will be interesting to see how they end this week.
 
Best,
 
Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk of loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Tues. Mar. 9th

Hello All,
 
We had a fairly uneventful Monday aside from the dip and recovery in oil.  Focus still seems to be on the dollar so we'll have to see what the change in commitment of traders will be tomorrow in reference to last weeks 50/50.  There aren't any major reports out tomorrow, so the lack of fundamentals may provide for another slow session.
 
1)  Hold Mar. Emini S&P shorts from 1133, with a 1144 stop.  Exit 1120.  Floor support is at 1120, and given the markets inability to muster up a significant rally today we should see a slight setback tomorrow.  At best we may only see 1125 where we may want to exit and re-enter after Wed. Crude inventory report.  The calm before the storm with Wierd Wally Wednesday as a precursor to next weeks option expirations.
 
2)  Hold Mar. Crude oil shorts from 81.80, with a 83.20 stop.  We were able to get a glimpse of how quickly this market can begin to slide, but were also reminded of the current markets trend and its ability to ignore fundamentals.  We have API and DOE data coming up, but with all the bearish news over the past few weeks we may actually need to get a bullish report to crack this market to the downside.  With stockpiles rising week after week we have to note that the forward curve is flattening out considerably. A 12 month contango has dropped from $8.32 per barrel to about $2.50 per barrel in the last 3 months.  If we can get a close below $81 tomorrow, I am confident we will see $77 into next week.
 
3)  Sell Mar. Euro on a stop at 1.3544, with a 1.3605 stop. Given its current weakness and the fact that gold and silver are also looking weak, leads me to believe that any flight to quality will go direcly to the dollar which will inevitably fuel the downside pressure.  A stronger dollar goes hand in hand with higher yields which plays into the big sell-off in bonds on Friday.  Resistance on the dollar is 80.90, so a breach of that level to the upside should coincide with our entry.
 
Best,

Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk of loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Fri. Mar. 5th

Hello All,

We have our unemployment numbers being released tomorrow morning 8:30 EST, and we pretty much had an inside day due to the fact.  The ECB kept its rates unchanged at 1%, but with ongoing fears in Greece they pulled the carpet out from under the Euro, and inversely strengthened the dollar.  This could also be combined with the fact that regardless of good news or bad news tomorrow, we're doing better than the Europeans, thus creating a flight to a better fiat currency.  Prices in the S&P can be inflated to the 1133 region where we should probably trigger off a sale.  Crude projects 81.80 where we will also probably want to go short.  And the Euro would probably be a sale around 1.3640 to retest the lows.  Also note that we have been rangebound in the Euro for 3 weeks now which worked out perfectly for our short option strangles.  We are exactly at the same price we were when we initiated the strangle on the 11th of Feb.

I'll have to wait and see how quickly these targets are reached before I can determine a protective stop.

Best,

Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

*There is a risk of loss trading futures.  Past performance is not indicative of future results.

Trade Recommendations for Tues. Mar. 2nd

Hello All,
 
1)  Exit Mar. Emini S&P longs from 1088 at the market (1114.25) and reverse.  Go short, with a 1123 stop. Hold for a couple days.  I'm abandoning my upper target for now given the strength in the dollar and weakness in crude.  No need to be greedy, plus I feel we're out of time.  We should see a pullback for a couple days, which may be followed by another rally, but it will all depend on how deep we fall.  If we can crack below the 1090 region, then I don't think this market will be turning back up.

2)  Mar. Euro seems to have solid support around the 1.3450 region.  I would anticipate a larger rally going into next week, but it contradicts with a higher dollar.  The market is stuck in a congestion pattern and we'll have to wait for a breakout to anticipate any sort of target.  Ultimately should see lower prices into mid/late part of the month.
 
3) Sell April Crude at 79.08, with a 80.30 stop.  Exit 77.40 into Wed.  My upper target failed to come in, and those of you who did not reverse once stopped out at 79.30 should have an opportunity to get onboard.  If we can somehow manage to stay above 76.50 after this weeks inventory report, then my upper target of 82 may eventually come in by next week.  Which would coincide with another secondary high for the ES.  We'll play it day by day and see what develops.  For the time being, the current course of action is playing out perfectly with respect to timing.
 
Best,

Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
 
*There is a risk of loss trading futures.  Past performance is not indicative of future results.