U.S. stocks climbed, extending the longest winning streak for the Standard & Poor’s 500 Index since July. The S&P 500 has risen 3.1% in the first six trading days of the month. President Barack Obama is scheduled to outline his intentions on Syria in a speech at 9 p.m. tonight in Washington. China’s industrial output rose 10.4% in August from a year earlier and retail sales gained 13.4%.
Equities: The SEP13 E-mini S&P 500 is up 11.5 points today to 1680.25. We are closely watching the 1684 level as a key resistance point. We believe this market will not rally that much further before the mid-month September Fed meeting, which may or may not reveal a tapering announcement. We believe that the 1684 level of resistance will be a strong barrier for the near term. We believe the market may head back down to 1666 before potentially making a run for new contract highs above 1700. The continually positive economic data out of China has really seemed to cause bulls to come out and play in the stock market again.
Bonds: The SEP13 U.S. 30-year bonds are down 12 ticks to 129’07 as investors seem to be less excited about bonds the more they see upbeat economic data from not only the U.S. but from around the world. We believe the bonds are not done going down, and have 127’03 as our next target below today’s levels. 130 is our current line in the sand.
Currencies: The SEP13 Aussie dollar continues its bull run today, trading up 58 ticks to 92.85. We believe the China economic data is having a huge impact on this currency’s recent strength, and have 94.15 as a potential target above today’s levels. The SEP13 Swiss Franc is back down today after a brief two day run higher to 107.50. We believe this 107.50 level will serve as solid resistance, and we also think the Franc might just head lower to approach its gap on the daily chart at 104.50 area.
Commodities: OCT13 WTI Crude oil is down $2.40 to $107.12 today, briefly trading below $107.00. We believe the oil market is still in a technical uptrend, but if the Syria situation is resolved peacefully, we may see a sharp drop in price to below $103. However, we also believe potentially increasing global demand from Europe and China (and the U.S.) may keep prices trending higher overall. OCT13 Sugar is another commodity we are watching closely. Sugar is up .07 to 17.07 cents/lb today, and we believe it will rally to at least 17.30 in the near term future as global demand picks up in places like China and Indonesia. DEC13 gold is down $22 to $1,364. We have $1,333 as a next level of support, and $1,396 as a key weekly 200E-MA.