header_img

CPI as Expected

by Archer Financial Services | Jun 12, 2018

By Alan Bush | Senior Financial Economist at ADMIS   

STOCK INDEX FUTURES

Stock index futures are higher after President Donald Trump and North Korean leader Kim Jong Un signed a joint statement at a historic summit, but offered few details on their promise to denuclearize the Korean peninsula. Additional talks are planned.     

The May National Federation of Independent Business small business optimism index increased to 107.8, which compares to expectations of 105.2.

The May consumer price index rose .2%, as anticipated and the CPI, excluding the volatile food and energy sectors, was also up .2%, as estimated.

Traders appear to be gradually shifting their focus of attention more toward the still bullish overall accommodative global interest rate policies and away from the geopolitical worries.

 

CURRENCY FUTURES

The euro currency continues to be supported by the belief that the European Central Bank at its policy meeting on Thursday will debate the end of its quantitative easing program.

The Bank of Japan will hold its regularly scheduled policy meeting on Friday.

The U.S. dollar continued to gain against the Canadian dollar as investors react to an escalating trade conflict between the two countries.        

   

INTEREST RATE MARKET FUTURES

Futures are lower across the board, as flight to quality longs continue to be liquidated.

The lack of flight to quality buying recently in any of the flight to quality vehicles, including Treasuries, suggests the market believes there will be a resolution to one degree or another to the variety ongoing geopolitical issues.

Today is the first day of a two day Federal Open Market Committee meeting. Tomorrow the FOMC will release a statement at 1:00 central time followed by a press conference at 1:30.

The Treasury will auction thirty year bonds today.

The probability of a fed funds rate hike from the Federal Open Market Committee tomorrow is 95%, which compares to 94% yesterday.

Although geopolitical events will inevitably develop from time to time, which will produce short periods of flight to quality buying, the main trend for futures is lower.

 

SUPPORT AND RESISTANCE

June 18   S&P 500

Support    2775.00       Resistance    2793.00

 

June 18   U.S. Dollar Index

Support    93.350         Resistance    93.960

 

June 18   Euro Currency

Support    1.17320       Resistance    1.18250

 

June 18   Japanese Yen

Support    .90450         Resistance    .91030

 

June 18   Canadian Dollar

Support    .76730         Resistance    .77150

 

June 18   Australian Dollar

Support    .7583           Resistance    .7625

 

September 18   Thirty Year Treasury Bonds

Support    142^2          Resistance    143^0

 

August 18   Gold

Support    1295.0         Resistance    1308.0

 

July 18   Copper

Support    3.2300         Resistance    3.2750

 

July 18   Crude Oil

Support    65.73           Resistance    66.77


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

Would you like to open an account with us? Go to our interactive New Account application at Open an Account. It is fast, saves on postage and it’s green.

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.

Offers