Retail sales in the U.S. rose 0.6% last month, the biggest increase in three months. The World Bank said in a report the global economy will expand 2.2% this year, less than a January forecast for 2.4% growth. Japanese equity markets slumped on concern there will not be more stimulus from the BOJ.
Equities: The JUN13 E-mini S&P 500 dipped to below 1600 for the second time this month, but today the market quickly found buyers below this key level. The market is now up 6.50 points to 1616, right around one of our key levels of 1617. We have our short term range levels at 1603 on the downside and 1625-28 on the upside. We believe the market could find itself in a sideways trade for the short- to medium-term as the market makes big decisions on how much the potential slowing of QE stimulus will affect the economy and therefore the market.
Bonds: The U.S. bond futures and Eurodollar futures are up slightly today. We believe this is movement associated with some profit-taking, not necessarily based on any new fundamental data. It could potentially be due to the World Bank issuing a lower global growth forecast, but overall, we still believe the bond market is in a trend of higher yields. We have 142’10 as a key resistance level for the SEP13 U.S. 30-year bond futures. The MAR16 Eurodollar futures is a market we track as well, and this market is up 4 ticks to 9854. We have short term resistance levels at 9858 and 9862.
Currencies: The Yen continues to do massive short covering action, following the BOJ’s announcement of no new stimulus. The Yen is up 148 ticks to 105.99. We have short term resistance at 106.20, which is the high volume area of today’s trade. Short term support is at 105.06, and then 104.50 below that. The Euro currency is down 6 ticks today to 133.30, from a recent high of around 134.00. We believe the Euro has bullish sentiment, and believe the Euro is now in a sideways to bullish condition. Our key market profile support is 132.64. There are no new bullish targets for the Euro so it may test some short term support levels before potentially going higher.
Commodities: Gold hit a key market profile level of $1,393, and could not hold above it. Today, AUG13 gold futures are down $16 to $1,375. We still believe gold is headed towards one of our targets at $1,348. We also believe if gold hits $1,348, it will head to 2013 lows in the $1,320s. The key grain markets are all down today, still digesting the USDA report from yesterday. Crude oil is unchanged today at $95.88. Crude is in a “coiling” position, thus indicating a potential break out move could occur. We believe this move could be down, as global growth prospects are more uncertain with the market losing confidence in the Asia region. Platinum futures are down big today: $35, or -2.34%. Platinum is approaching the key $1,450 level, and if the precious metals sell-off trend continues, platinum could indeed approach the next key level at $1,400.
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