Trade Recommendations for Wed. Mar. 23rd

Hello All,

1)  Sell June Emini S&P above 1286 at the open of the morning session, with a 1296 stop.  Exit next week.  It seems as though a fourth wave correction has ended and we should begin a descent subdivided in five waves towards 1220-1240.  Could higher crude prices jolt this market off its foundation? Or would it be another suprise out of Japan?  The rally over the last 3 days was surprising enough, but glad that it's come to an end.  Let's wait and see what develops overnight.

2)  Wait until after the EIA inventory data to sell crude.  Today was the April contracts expiration which could have contributed to the rally along with Middle East headlines.  I do see a top forming over the next 48 hours, but the difficult aspect is that it has a $3-4 range.  If we fail to take out 105.50 overnight, then I would suspect it to be safe to sell.  API came in with a draw of 970k barrels when analysts were expecting a draw of 2 million. 

3)  Still observing the Euro as it has halted under major resistance at 1.4250, difficult to make a count on the pattern so we will look to the dollar instead for signal.  If the anticipated correction on the dollar is in 5 waves, then we feel confident that the Euro will be headed lower, but if it is in 3 waves then I would suspect to see 1.44 basis the Euro.  Still too early to tell, but should have a better understanding by mid-next week.

P.S.  I will be in the office until the close tomorrow, and returning next Thursday.  Your respective brokers will be able to assist you in my absence.  I will be checking emails periodically.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

Merger Monday stole the show...

Hello All,

We took military action on Libya over the weekend, Japan's nuclear crisis has eased, and JP Morgan gives AT&T a $20 billion dollar bridge loan to buyout T-Mobile.  The biggest deal on the books in history is a sign that JP Morgan is raising the bar, which should entice competing banks to take on 'riskier' deals to keep up.  The Libyan action could already be baked into the cake as we expected this to be the only resolution.  And without any additional 'bad news' out of Japan it would be considered good news.  With respect to currencies, the dollars standard deviation as of late leads me to forecast a shift in trend by weeks end. 

1)  Buy June Emini S&P at 1287, with a 1281.50 stop.  Exit 1296.50.  Ultimately 1300 will psychologically prove to play resistance, with a bit of grey area to take out some stops.  I believe we are in a 4th wave retracement which could top out at a max of 1310, so we will be patient before weakness sets in towards the end of the week.

2)  Stand aside Crude oil overnight.  Too many variables that can affect this market overnight.  I remain biased towards the downside, but as always ready to expect the unexpected.

3)  Stand aside Euro.  As bearish as I am, I know markets can remain irrational longer than we have money, so we will be patient to catch the turn.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

Triple Witching - volatility is to be expected...

Hello All,

After the largest 3 day drop since August, the S&P held up fairly well given the support across commodities.  Optimistic about Japan getting their nuclear power plants back online, the fear dissipated ahead of triple witching tomorrow.  The Japanese are working on connecting a new power cord which could possibly come online overnight, which would alleviate the pressure, but if they are to fail, I feel we will be right back on track to making new yearly lows.  The unrest in the Middle East continues, and the UN is to decide on whether they will take military action against Libya.  Although it may be the right move, politically the timing would be off given the Japanese crisis.  Todays option expiration on Crude oil could have been the trojan horse behind the rally, and I remain cautious at the moment as I expect a deeper pullback along with equities.  On the currency front, the US dollar hit a 4 month low as the safe haven trade has bid up the swiss and yen.  If the situation in Japan is to get worse, I feel that the allocation of assets will have to switch from the Swiss to the US, and if all turns out to be well then the Swiss will retreat on its own.  No need to mention that we do not like playing with fire, so we shy away from the yen altogether in uncharted territory and turmoil.  The Euro continues to test its yearly high, and from my point of view the financial ramifications from the earthquake will delay or at least cede speculators from anticipating a rate hike next month.  Ultimately, the US dollar is setting itself up for a great buying opportunity, but as usual, we rather be late to the party than the one paying for it.

We wont trade overnight, but will likely be sellers in the morning.

Looking to:

Sell the June S&P between 1272-1278, anticipating 1220-1230.
Sell June Euro on pressure below 1.3940.
Sell Crude once the S&P breaks below 1260.

P.S.  I will be traveling from the 24th-31st, as nightly updates will be suspended during my absence.

Best,

Arman Vahdatinia
President, Chief Market Strategist

1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

Trade Recommendations for Thurs. Mar. 17th

Hello All,

The spike in the Japanese yen afterhours will keep us on the lookout for any news that can rattle the globe.  With volatility spiking, premiums are ripe for the picking.  Ultimately, too many variables with Japan and the Middle East, many markets can go either way so we'll play tighter than usual, and as always use all of our open positions as hedges against one another.

1)  Sell June Emini S&P at the market (1261), with a 1271 stop.  Exit below 1220.  Equities are in trouble and given all the turmoil I am both surprised and glad we aren't having a panic meltdown.  Until the Japanese get their nuclear plants under control, pressure will continue.

2)  Sell June Euro at the market (1.3910), with a 1.3980 stop.  Exit 1.3680.  The euro held up fairly well with Portugal's rating cut, and we continue to expect downward pressure as sovereign debt issues are brought back to the forefront.

3)  Buy April Crude at the market (98.34), with a 97.60 stop.  Exit 99.75.  We have option ex tomorrow, and find it positive that Crude held up well when equities tumbled. It is possible we could even see 101.50 before met with resistance.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

Market Analysis for Wed. Mar. 16th

Hello All,

We saw a sea of red across the commodity sector today as the risk trade came off, and investors may have hedged their long equity positions with short commodities.  All eyes continue to be diverted towards the Japanese tragedy, and with the Nikkei down nearly 20% the ripples are seen across the globe.  The flight to safety has been evident in treasuries, the swiss franc, and the yen itself.  The broad sell-off in Crude illustrates that the curbed demand out of Japan outweighs Middle East conflict at the moment.  Even though our attention may be diverted we must note that Bahrain's king declared martial law today as his government struggled to control an uprising.  Fundamentals aside, Crude needs to hold it's current levels (give or take a dollar given the volatility) if the uptrend is to remain intact.  API data this afternoon showed a build of 91,000 barrels of crude, but we will await EIA data for the real picture.  With respect to equities, we have broken technical levels and the possibility for lower prices remains on the board.  For the past 3 sessions, the market has sold off and then a short squeeze ensued into the close, only to be followed by additional selling overnight.  Over the next 16 hours, I believe it may be the opposite, where the market will continue to rebound into the a.m. and then be met by selling during normal US trading hours.  As with any disaster in history, the markets have a broad sell-off on fear and liquidity, and then we see a recovery.  As resilient as equities have been the past year, we shouldn't expect any different over the long haul.  The Fed left interest rates unchanged today, continuing with their loose monetary policy which had a negative effect on the dollar in relation to the Euro.  It is deemed that the ECB may raise rates prior to the Fed, but speculation can only go so far with the EU sovereign debt issues.  Moody's cut Portugal's long term ratings to A3 from A1 with a negative outlook, and you can only expect the pattern to continue.

We anticipate to sell equities shortly after the open, and buy crude after the EIA inventory report.  The Euro will probably have an inside day, and we'll need a break of yesterdays low before we jump on the short side.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

The day of rage will dictate our positions...

Hello All,

An increase to jobless claims, a wider trade deficit, and a slowdown in China's export growth triggered todays meltdown.  The Saudi 'day of rage' is upon us, and if we get any more gunfire like we did today, it is possible for oil and metals to rally very sharply.  Our attention was taken off Middle East turmoil and directed towards China, but a mere distraction.  The turmoil has now been taken to the doorstep of the #1 oil producing nation, Saudi Arabia.  The 'day of rage' which has been organized on the internet for pro-democratic protests to take place on March 11th (tonight) has escalated its level of danger after police opened fire with rubber bullets today.  Most likely after Friday prayer, citizens will take to the streets for peaceful protest, but if it creates martyrs, then all hell can brake loose.  We continue to watch these dicatorships come to an end as a majority of their populations are under the age of 30, without work, or basic human rights....The oil payouts can only go so far....This can either be the beginning of the end...or the end for now....we remain at the edge of our seats.

1)  Hold Mar. Emini S&P shorts, lower the stop to 1304.50.  Exit next week.

2)  Hold Mar. Euro short, lower the stop to 1.3860.  Exit 1.3680.

3)  Buy April crude oil at the market, use a 101.40 stop.  Exit 109.

4)  Stand aside Gold.  The market broke through support, and we await the possible flight to safety given scheduled protests.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

Another day closer to a breakout...

Hello All,

IBM at all time highs has propped up equities for the day.  EIA inventory showed a build of 2.5 million barrels, less than the 3.8 reported by API yesterday.  Gaddafi has actually bombed oil facilities today in retaliation of the no-fly zone proposed.  The lunatic is fearful of the West taking control of their oil production, so he rather sabotage his own countries well being.  Although the strike has been discounted from the markets, it is a sign that tensions are escalating as we await the next shoe to drop.  You can take a look at the oil curve 6 months out as contracts were in the black for the day.  We remain long term bullish.  Gold and Silver continue to float even though Copper took a beating today, which in my opinion is a precursor to what may take place in equities.  Gold held its upward trending channel perfectly and we continue to anticipate a dramatic pop towards 1500.  The key would be front month oil taking out 106, and it will create a flight to safety domino effect.  The Euro continues to tread water along with most markets, but the sovereign debt issue will take its toll soon enough. 

1)  Hold Mar. Emini S&P shorts, lower the stop to 1328.  Exit next week.

2)  Hold April Crude oil longs, with a 101.50 stop.  Exit 109.  We have option ex next week, and I anticipate they will make the shorts pay up even more.

3)  Hold Mar. Euro shorts, maintain stop at 1.3960. Exit 1.3680.

4)  Hold April Gold longs, raise the stop to 1421.  Exit above 1455.

If you would like to receive these updates in a more timely manner via email, please submit a request.

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Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

The markets are hovering, waiting for a catalyst..

Hello All,

There's not much out there to really grab your attention, an inside day to say the least.  OPEC mentioned the possibility of increasing output, and bank stocks helped bid up the financial sector. Gaddafi continues to launch air strikes around important oil fields, but the OPEC news seemed to shrug off any further advancements for the day.  Could this be the calm before the storm?  Everyone knows the 'worst case scenario,' and it seems as though we're in a wait and watch mode to see how chaotic Middle East turmoil can get.  The US dollar looks as though it may have put in a bottom, and that plays into my safe haven transition theory.  The dollar gained against the Euro today as the recent interest rate speculation has overshadowed the EU's lingering debt problem, which is beginning to rear its ugly head once again.  The pullback in the metals was dismal, and we still expect new highs in the coming days.  API reported a build of 3.8 million barrels of crude, which shouldn't come as a surprise given current prices levels.  But we're not trading supply, we're trading off the Middle East.  If EIA were to report an even larger build tomorrow, I would imagine it to be another excellent buying opportunity.  We have to coax investors into selling somehow, right? I personally don't think we'll be seeing 2 digit oil again this year.

1)  Sell Mar. Emini S&P at 1322, with a 1332 stop.  Exit next week.  The marker rallied enough to stop us out today, but I'm still confident in the trade to get back on.

2)  Hold April Crude Oil longs, add positions at 103.15, use a 101.50 stop. Hold into next week, targeting 109.

3)  Hold April Gold longs, lower stop to 1419.  Exit above 1455.

4)  Sell Mar. Euro at the market, with a 1.3960 stop.  Exit 1.3680.

If you would like to receive these updates in a more timely manner via email, please submit a request.

Begin trading alongside me. Request a free futures trading demo account and gain access to real time data, charts, and $50k in virtual cash.

Best,

Arman Vahdatinia

President, Chief Market Strategist

1-877-338-EXPO [3976] ext. 25

www.ExpoFutures.com

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

 

Trade Recommendations for Tues. Mar. 8th

Hello All,
 
1)  Sell Mar. Emini S&P at the market (1314), with a 1322.75 stop.  Hold into expiration next Friday.  The last leg of this congestive mess should be over with sometime in the next 24 hours.  With energies and metals continuously squeezing out new highs, I believe the larger move has yet to come when investors finally begin pulling out of equities.  One more breach of the 1300 level and we should be looking for 1220-1250.
 
2)  Hold April Gold longs, raise the stop to 1421.  First target is 1455, with the possibility of taking out 1500.  We managed to put in a new high, and although one would expect this market to move straight up, the stair step action is tolerable.  We'll see what happens leading up to the 'day of rage'.  With silver on its way to $40, the yellow metal will hopefully make-up for its shortcomings the last few sessions.
 
3)  Buy April Crude at 103.90 and 103.15, with a 101.80 stop.  Exit 109.50.  The last $3 on crude was a walk in the park afterhours, with the lack of sellers even moreso evident.  The road to $150 is being paved as we speak, and the only thing that may or may not slow down the bull would be a raise in interest rates to not only slow crude, but the entire economy.  Option premiums above the 120-130 strikes are still bid up extremely well which portrays market sentiment.  As each day passes without any resolve in Libya we can only continue to expect the worst.

4)  Stand aside Euro.  Greek bond ratings were once again downgraded, but nothing surprising.  Crude has put pressure on the US dollar, which has inversely supported the Euro, but I believe we are at an inflection point.  The US dollar should now benefit from the flight to safety as metals and energies continue their charge.

If you would like to receive these updates in a more timely manner via email, please submit a request.

Begin trading alongside me. Request a free futures trading demo account and gain access to real time data, charts, and $50k in virtual cash.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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

Unemployment data to close out the week.

Hello All,

Jobless claims came out better than expected, and ISM came in line showing the service sector is healthy.  Oil began to slip as Venezuela's Chavez stated he would aid in the removal of Gaddafi, but we continue to congest awaiting the next 'bomb' to drop.  As one of my client's noted, one would have to talk some sense into Chavez first and foremost, let alone have him to get Gaddafi to retreat.  Trichet made a notion that the ECB may decide to increase rates come next month, in essence the potential for tightening should be fully priced in by now at 4 month highs.  We have our unemployment data to be released tomorrow, which should be supportive for the US dollar given recent economic indicators.  Gold retreated from it's highs based on positive unemployment claims and the pull back in oil, but this presents a buying opportunity both technically and fundamentally.  The recent pullback could be considered a 4th wave correction, which has held above the 1408 support and we may very well be on our way to new highs as Middle East tensions continue to escalate.  Any mediation with the assistance of Chavez is bound to go wrong, at least the first time around, so I am cautiously doubtful.  Needless to say, the contagion is spreading and you should all be watching international news stations rather than the US puppets.

http://english.aljazeera.net/

The market that makes the least sense in my mind is the S&P, weak longs and shorts have been taken to the cleaners the last few days.  The only plausible pattern would be an abcde correction.

1)  Sell Mar. Emini S&P at 1334, with a 1344 stop.  Exit 1323.

2)  Buy April Gold at 1414, with a 1395 stop.  Exit 1455.

3)  Wait 10-15min after our unemployment data to sell the Euro.

4)  Buy April Crude at 101.60, with a 99.80 stop. Exit 106.

Best,

Arman Vahdatinia
President, Chief Market Strategist
1-877-338-EXPO [3976] ext. 25
www.ExpoFutures.com

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