E-Mini S&P 500 (CME:ESM14)
Look For The Market To Press New Highs Early
Equities have continued higher as the S&P is poised to test our major upside target of 1917-1919. Despite a higher than expected German unemployment, European indices have held at the highest level since 2008. As the recovery in Europe is seen to be a choppy one, many have begun to speculate we will see further easing action from the European Central Bank in next week’s meeting. Similar to what we saw last year at this time, the “bad news is good news” effect prior to the taper, we are now getting out of Europe. Has this helped boost U.S. Equities? Of course it has.
Also playing a hand in helping the equities higher is what seems to be progressive news out of Ukraine for the first time, as we are now seeing some of the risk off sellers move back into the market. Though this may only play a small role, it can help add to the path of least resistance higher. The major focus is will continue to be speculation ahead of the ECB meeting and US GDP and Pending Home Sales tomorrow.
Resistance- 1917-1919****, 1938**
Pivot - 1910
Support – 1904.75-1906**, 1898.50-1900**, 1893**, 1880.50-1883***, 1874-75.50*, 1866-1867.75**
Time To Get Short At The Top End Of The Range
Crude Oil has continued to consolidate at the highest levels seen in a front month contract since May tested 104.99 in April. Today’s swing high of 104.39 has remained in check by our resistance 104.29. Weak economic data out of Europe is encouraging by the possibility of further stimulus measures. Traders who stuck to the game-plan and bought tests to 103.65-103.85 had several opportunities to make money yesterday.
However, a retest to this level today with a Dollar heading higher will likely press lower to our major 103.11 three star support ahead of API inventory today and EIA tomorrow. Though on the outside the situation in Ukraine looks to have progressed positively, there is still a fear of gas supply disruption as fighting continues. Furthermore, ongoing production outages in Libya will keep a premium in the market. This will provide a great opportunity to buy against major support at 103.11 if it arises as any selloff will likely be limited.
Resistance –104.29**, 104.77*, 104.99-105.22***, 107.33***
Support – 103.65-103.85**, 103.11***, 102.49**, 101.92*, 100.82***, 100.29**