Hello All,
We had a fairly quiet Monday after some positive action from the Asian and European session. Stocks edged higher as most other markets just wavered as trading was fairly light. The main influence of the day was a lower dollar, and although stocks advanced, treasuries mounted a comeback late in the day so it is difficult to tell which market is fading. I would suspect that if we continue to report above average earnings, we will continue with the current trend and the S&P should be poised for 1130. This would coincide with 125-126 on the 30 yr bond, and possibly 1.32 on the Euro. As the European bank stress tests came back fairly optimistic, today was the first day of European trading after the release of the results and it looks as though the risk trade is back on. If this holds true, we should also be able to see the $81 region on crude before we get any type of siginificant pullback for about a week or so. Best buying opportunity across the board seems to be the first week of August for the next big leg up. All in all, after a lackluster day, it looks as though we need more data to really move the markets. The results from the stress test didn't seem to be enough of a catalyst. We have Case Schiller and Consumer Confidence tomorrow, and then Durable Orders and Crude Inventories on Wed. If consumer confidence can't seem to move the markets, then we may be in for a slow week to end the month. Overall, we would like to initiate fresh short option ratios on the Euro, BP, and Crude; so we'll be looking to put some capital to work tomorrow.
Best,
Arman Vahdatinia
Futures & Options Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com
*There is a substantial risk of loss trading futures. Past performance is not necessarily indicative of future results.
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