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Stock Index Futures Higher in Spite of Ongoing Trade Tensions

by Archer Financial Services | Apr 03, 2018

By Alan Bush | Senior Financial Economist at ADMIS   
 

STOCK INDEX FUTURES

The Trump administration will unveil by Friday a list of advanced technology imports from China that could be subject to new U.S. tariffs.

China’s ambassador to Washington said China will take counter measures of the “same proportion” and scale if the U.S. imposes additional tariffs on Chinese products.

Ongoing trade issues will only temporality pressure futures.  

 

CURRENCY FUTURES

The euro currency is steady after it was reported that the euro zone March PMI was 56.6, as expected.

The U.S. dollar and the euro currency are in broad sideways congestion patterns. Ultimately the U.S. dollar should breakout to the downside and the currency of the euro zone should breakout to the upside.

I continue to anticipate the double top resistance at the 1.26500 - 1.26580 area in the June euro currency to be taken out, although it may take some time.

The British pound is higher on news that the U.K. March Manufacturing PMI was 55.1, which compares to the estimate of 54.4.

There was little market reaction when Bank of Japan Governor Kuroda told parliament the bank is discussing stimulus exit options.

The Reserve Bank of Australia kept interest rates unchanged for the 18th straight meeting.   The RBA kept its official cash rate at a record low 1.5%.  The Australian dollar firmed after the RBA governor said inflation is expected to pick up as the economy strengthens.

 

INTEREST RATE MARKET FUTURES

Futures are lower since it appears very likely that the Federal Reserve will hike its fed funds rate in June.

Also, there appears to be no flight to quality buying in spite of the ongoing trade frictions between the U.S. and China.

Minneapolis Federal Reserve Bank President Neel Kashkari will speak at 8:30.

The probability of a fed funds rate hike from the Federal Open Market Committee at the June 13 meeting is 85%, which is unchanged from yesterday.

 

SUPPORT AND RESISTANCE

 

June 18   S&P 500

Support    2573.00       Resistance    2616.00

 

June 18   U.S. Dollar Index

Support    89.450         Resistance    89.850

 

June 18   Euro Currency

Support    1.23210       Resistance    1.24150

 

June 18   Japanese Yen

Support    .94260         Resistance    .95150

 

June 18   Canadian Dollar

Support    .77550         Resistance    .78170

 

June 18   Australian Dollar

Support    .7661           Resistance    .7701

 

June 18   Thirty Year Treasury Bonds

Support    146^0          Resistance    146^30

 

June 18   Gold

Support    1333.0         Resistance    1349.0

 

May 18   Copper

Support    3.0350         Resistance    3.0750

 

May 18   Crude Oil

Support    62.75           Resistance    63.89


For more information about these markets, please contact Alan at 312.242.7911  or via email at alan.bush@admis.com. Thank you.

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Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The risk of loss in trading futures and options can be substantial. The views and opinions expressed in this letter are those of the author and do not reflect the views of ADM Investor Services, Inc. or its staff.  Research analyst does not currently maintain positions in the commodities specified within this report. The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright © ADM Investor Services, Inc.

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