Trade Recommendations for Thurs. May 26th

Hello All,

Fundamental data for the day was the EIA energy report, posting a build of 600k barrels of oil and a surprising 3.7 million barrel build for gasoline.  In light of the bearish report, Crude oil climbed above $100 and closed near resistance.  Goldman Sachs followers are putting the risk trade back on, which was widely evident with the S&P bouncing significantly off the 1300 level.  Metals push up to 2-3 weeks highs on option expiration, and the question over the next couple of sessions is whether we will see some profit taking ahead of Memorial Day weekend.  I anticipate trading volume to be light over the next week or so given the holiday, which is why I am taking in some option premiums to capitalize on the decay.  The Euro is still holding her head above water (1.40), but the action on the charts doesn't look too positive.  The main benefactor of the EU debt crisis would have to be the Swiss Franc, which is not only labeled a safe-haven currency, but chart action would suggest that even at a record exchange rate investors still anticipate a rate hike; however, given it's current valuation we would rather opt for the AD or CD trade.  We have GDP and unemployment claims to be reported tomorrow, which I suspect will be positive for the market.

1)  Buy June Emini S&P at 1317, with a 1311.50 stop.  Exit 1332.

2)  Sell June Euro at 1.4205, with a 1.4275 stop.  Exit 1.39.

3)  Stand aside Crude.

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.

Mixed data weighs on the markets...

Hello All,

New home sales were up 7.3% in April from a month earlier, but sales are still down 23.1% from a year ago.  European debt is still an issue on the table, and Goldman Sachs raised their Q3 forecasts for Crude oil as global demand increases.  API data this afternoon showed a decline of 860k barrels of oil, gasoline inventories increased 2.4 million, while distillates declined by 864k.  EIA data is expected to show a draw of 1.6 million barrels of oil, so we will await tomorrows data.  Funadamentals aside, $100 kept a lid on crude oil, even as the investment banks increased their year end forecasts.  Given the mixed data as of late, investors are pulling back towards a more neutral stance rather than bullish.  We still have no idea how the market will act with metal option expiration tomorrow, but given the recent bid, we will probably attempt to buy pullbacks into the beginning of next week (if we are given the opportunity).

1)  Hold June Emini S&P shorts, lower the stop to 1312.  Exit 1296.

2)  Hold June Euro shorts, lower the stop to 1.4090.  Exit 1.3910.

3)  Stand aside crude until EIA data is released.

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.
 

Eurozone worries fuel the sell-off...

Hello All,

European PMI indicated slower growth, with German and French numbers below expectations.  Standard & Poor's downgraded Italy's outlook to 'negative' from 'stable', and several EU leaders are calling for Greece to avoid debt restructuring and to move forward with austerity measures.  To the far east, China manufacturing growth has slowed, which contributed to the commodity sell-off.  With all these problems abroad, the US dollar gained significantly as the Euro was pushed to a 2 month low breaking my 1.40 marker.  With global growth contracting, crude oil knocked on its lows for the 4th time in the past 2 weeks, and I suspect the 5th time around will knock it down towards $93.  New home sales are due to be reported tomorrow, and we have crude inventory data on Wednesday, along with option expiration for metals.  More volatility is yet to come, but will we take a breather before Wed?

1)  Sell June Emini S&P at 1319, with 1325.50 stop.  Exit 1302.

2)  Sell July Crude oil at 98.50, with a 99.75 stop.  Exit 93.

3)  Sell June Euro at the market (1.4050), with a 1.4150 stop.  Exit 1.3910.

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 Fri. May 20th

Hello All,

It was a fairly sluggish day as Linkedin's IPO and the IMF chiefs bail hearing were the center of attention.

1)  Sell June Emini S&P at the market (1341), with a 1354 stop.  Exit 1312.  We've technically reached resistance at the downward trending channel from the 1373 high.  Worst case, the market should not take out 1350.

2)  Sell July Crude at 99.75, with a 101.25 stop.  Exit 93. The June contract is expiring and we may be in for a volatile day.  Either way, we want to be short into next week.

3)  Sell June Euro at the market (1.43), with a 1.4450 stop.  Exit below 1.40. The 50 day MA seems to have a lid on this market for the moment.  Not a currency you want to be long over the weekends as anything can develop across the Atlantic.

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 5/19

Hello All,

We started the day off with positive figures from Dell and finished the day off digesting the Fed minutes. The Fed doesn't seem to be any hurry to raise interest rates and remains transparent with respect to weening off bailouts. The question still remains as to whether the economy can sustain growth without government help, but there's only one way to find out. Still in the process of strategizing an exit plan, we have to make due with the action in treasuries as we were set-back almost a handle. The dollar remained fairly flat, and Whipsaw Wednesday was in full effect with inside ranges in most markets. Crude oil EIA data showed a draw of 15k barrels, after API reported a build of 2.7 million. The bullish data along with wildfires affecting Canadian oil sands production allowed crude to break above 100 basis June, but closed the day below. In my opinion the action was overdone and I retain my bearish sentiment, but remain nimble at the same time. The Euro remained rangebound as investors are skeptical with respect to Greek debt restructuring; the days highs will have to be respected, along with the 50 day MA at 1.4325. Once again, we find ourselves at a critical juncture and would need technical confirmation of a breakdown or breakout before participating in futures. We have stock index options expiring on Friday, so we anticipate skewed action which was present today; whether it will hold up, we will find out tomorrow. As for metals, $100 oil fanned the fire for the yellow and silver metal, but in the wake of George Soros selling off the bulk of his gold investment and Silver having yet to justify a trading range after dropping 27% leaves the markets susceptible to sharp sell-offs. Technically, gold was unable to climb above 1500 and Silver fell far short of the 36.80 resistance as traders covered shorts going into the Fed minutes.

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 Wed. May 18th

Hello All,

Both housing data and industrial production showed signs of slowing, along with disappointing figures from HP and Walmart show that we may have hit a soft patch. Although the weakness was short-lived, we have yet to see evidence of a bullish bounce. With crude oil options expiring today, it seemed to be the leader into the close holding above the $95 support. API data reported a build of 2.7 million barrels of crude, the expected number was 1 million, and tomorrows EIA data expects a build of 500k. Lower lows, and lower highs continue to be the trend across various markets, so we remain bearish. There are talks of Greek debt being restructured, which should continue to pressure the Euro and dollar denominated commodities. The less than robust macro economic data as of late leads investors to question the end of QE2, but we should have some more insight come the release of Fed minutes tomorrow. All in all, todays action was a scratch in my mind, but economic data will continue to favor the bears.

1) Hold June Emini S&P shorts, with a 1335 stop. Exit 1308.

2) Hold June Swiss Franc shorts, with a 1.1388 stop. Exit below 1.11.

3) Hold June Euro shorts, with a 1.4260 stop. Exit 1.4015.

4) Hold July Crude shorts, with a 99.25 stop. Exit below 95. Some of you were wise enough to take profits and get back in, our stance remains the same. Whipsaw action due to option ex.

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.

 

Melt down continued...

Hello All,

All eyes on the Euro as the IMF chief was arrested on sexual assault charges, which would weaken the IMF's ability to resolve the Euro zone debt crisis.  Mississippi flooding has been diverted to avoid gasoline refineries, and the result was a 15 cent drop to start off the C wave mentioned last week.  Support levels are being violated across the board for commodities and I expect deterioration to escalate tomorrow.  Grains were positive for the day to close the gap on the charts from last weeks USDA report, and we await planting before establishing a short position.  The S&P is headed towards my 1312 target noted last week, which may present proper valuation for investors as other ships continue to sink.  I still feel the Euro needs to test and break the 1.40 level, which would coincide with Crude below $95. 

1)  Sell June Emini S&P at 1325, with a 1335 stop.  Exit 1312.

2)  Sell June Swiss Franc at 1.1320, with a 1.1380 stop.  Exit below 1.11.  With the IMF chief being arrested, the SF provides a natural safe-haven trade which was noticed in today's unnecessary bounce.

3)  Sell June Euro at 1.4170, with a 1.4260 stop.  Exit 1.4010.

4)  Sell July Crude oil at 98.10, with a 99.25 stop.  Exit below 95.

Best,

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

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

Whipsaw Wednesday has moved to Thursday..

Hello All,

Early morning weakness was on point, but the reversal strength was unexpected in silver, crude, and grains.  Although the rallies fizzled out late in the day, it will be important to see how the Asian markets react at the open.  If they cannot muster up any type of rally, I would expect to see new lows tomorrow to close out the week.  Equities may be the only safe-haven as they have held fairly steady through the course of all this craziness, but technicals lead me to believe that we need to see the S&P in the 1310 region before we can head towards 1400.  I expect to see the Euro test the 1.40 region on sovereign debt worries. Silver should test $30 and have all the late comers scrambling for the exits, in addition to anyone holding onto a prayer. Crude should retest the $95 support level as it failed staying above $100 basis June.  Bond auction results were horrible, and in my opinion the main catalyst for sending the dollar lower.  Sentiment changes on a daily basis...risk on, risk off, risk on, risk off.  Going into Friday, risk would have be off in my book. ABC retracements are evident, and we're only beginning leg C this afternoon.

1)  Stand aside S&P.  May have a possible sale around 1352.

2)  Sell July Crude at 100.40, with a 101.60 stop.  Exit near 95.

3)  Hold Euro shorts, with a 1.4307 stop.  Exit 1.4030.

4)  Sell July Corn at 696, with a 708 stop.  Exit 640. 

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.

Commodities slide on a stronger dollar, and will continue to slide...

Hello All,

We seem to be in the process of resuming last weeks sell-off as noted in last nights report.  The heavy hitter of the day was RBOB gasoline which went limit down and energy trading was halted to increase its limits.  This response from the exchange was similar to what we saw last week in crude, which opened the door for further deterioration.  The tops are in for most markets, and any bounce needs to be sold, regardless of how much prices have already depreciated.  It may very well turn out that the unwinding of QE2 positions has begun, and anyone late to the party seeking value will be taken to the cleaners.  Figures out of China showed inflation remained above the governments target, which raises concerns for further monetary tightening.  We had a bearish USDA crop report which sent corn and wheat limit down.  EIA inventory data was bearish for the energy sector with gasoline limit down, and I expect further weakness to close out the week with unemployment claims, ppi, and retails sales due tomorrow.  In my experience, when markets become lock limit, the craziness spills over into outside markets that still have room to go.  With the Euro taking out last weeks low, we remain open to a test of 1.40 which should prop the US dollar above 76 as commodity prices continue to slide.  Crude margins have been raised to $8100 per contract as speculators are slowly being squeezed out.  Major support for crude is at $92, but we'll have to see how she reacts to the 96.50 support basis June to get a better understanding of the wave count. 

1)  Sell June Emini S&P at 1342, with a 1349 stop.  Exit 1312.
2)  Sell July Crude oil at 99.70, with a 101.60 stop.  Exit to be determined.
3)  Sell June Euro at 1.4238, with a 1.4307 stop.  Exit 1.4110.
4)  Sell July Corn at 682, with a 692 stop.  Exit below 650.

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.

We're at a critical juncture after last weeks sell-off...

Hello All,

We are at a tipping point where we either revert to last weeks bearish sentiment, or resume the uptrend.  The two key markets to watch are silver and crude.  Fundamentally, crude has had its margins increased but the flooding of the mississippi puts gasoline refineries in harms way.  We'll have to see what impact tomorrows inventory report has, and to what effect the trade balance data will have on the dollar.  Silver has resistance at 39.40, and psychologically at 40.  I've been in sit and wait mode until given a solid signal, which should be available for us tomorrow.  Not to mention we have our USDA crop report due, which could contribute to a volatile day.  The positive thing out of all the craziness is that option premiums and strike distances are back towards levels seen two years ago.  Equities should continue their uptrend as mergers are always good news, and may seem as a more stable asset given the circumstances.  The Euro should have resistance at 1.45 as selling based on Greece worries have subsided for the time being.  Ideally, I would expect the dollar to bounce towards 76 and maintain pressure on commodity prices for the next couple of weeks, but with bulls and bears pulling on both ends, we'll try and be as non-directional as possible.

In the larger scheme of things, we've probably witnessed cyclical highs last week.  Inflation in Bernanke's words is only transitory, and Mid-East tensions aren't escalating.  I guess we'll really know come June 30th.

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.