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A Better Tone to Trade Issues Supports Stock Index Futures

by Archer Financial Services | Jun 27, 2018

By Alan Bush | Senior Financial Economist at ADMIS   

STOCK INDEX FUTURES

Stock index futures fell in the overnight trade as global trade worries persist.

However, futures quickly rebounded when it was reported that the Trump administration decided to rely on existing laws to restrict Chinese investment in the U.S., and dropped consideration of implementing alternative approaches that would allow the White House to impose stricter limits.

Major Chinese stock indexes continued to decline from their January highs. The Shanghai Composite Index dropped 1.1% after entering bear market territory yesterday.

Orders for durable goods in May, which are products designed to last at least three years, declined .6%, which is the second straight monthly decline. Economists had expected a 1% decrease for the month.

The 9:00 central time May pending home sales index is expected to be up .6%.

Although the global trade situation appears to be getting worse, we are seeing less and less flow of funds into the flight to quality markets such as Treasuries and the Japanese yen.

 

CURRENCY FUTURES

The euro currency fell as concerns about an escalating global trade conflict boosted the U.S. dollar, while the Chinese yuan fell to a six month low.

The euro is lower in spite of news of stronger than expected euro zone money supply and bank loan growth in the March through May period.

The British pound is lower after a report showed London house prices declined, as U.K. property values continue to soften.

 

INTEREST RATE MARKET FUTURES

Futures advanced on news that U.S. durable goods orders fell in May for a second consecutive month.

Federal Reserve speakers today are Federal Reserve Vice Chairman Randal Quarles at 10:00 and Boston Federal Reserve Bank President Eric Rosengren at 11:15.

The Treasury will auction five year notes today.

The probability of a fed funds rate hike at the Fed’s September 26 meeting is 74%, which is unchanged from yesterday.

 

SUPPORT AND RESISTANCE

September 18   S&P 500

Support    2703.00       Resistance    2739.00

 

September 18   U.S. Dollar Index

Support    94.110         Resistance    94.820

 

September 18   Euro Currency

Support    1.16530       Resistance    1.17550

 

September 18   Japanese Yen

Support    .91030         Resistance    .91770

 

September 18   Canadian Dollar

Support    .75050         Resistance    .75470

 

September 18   Australian Dollar

Support    .7355           Resistance    .7417

 

September 18   Thirty Year Treasury Bonds

Support    144^0          Resistance    145^4

 

August 18   Gold

Support    1253.0         Resistance    1266.0

 

September 18   Copper

Support    2.9800         Resistance    3.0300

 

August 18   Crude Oil

Support    70.45           Resistance    72.03


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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