Volume might be reason for the current rally in stock futures

Top Day Rec

08.20.09

Initial claims at 8:30 with Leading Economic Indicators and Philly Fed at 10.

China backs away from the precipice overnight and equities are slightly higher.

The current rally in stocks is suspect for one reason: volume. There’s been a stead volume decline since March. If you extract the fake volume of flash trading (which should have triggered a volume explosion) there’s very little left.  

 

Aug 17 08:30 Empire Manufacturing Aug   5.00 2.20 -0.55   Aug 17 09:00 Net Long-Term TIC Flows Jun   NA $17.5B -$19.8B   Aug 18 08:30 Building Permits Jul   565K 576K 570K   Aug 18 08:30 Core PPI Jul   0.1% 0.1% 0.5%   Aug 18 08:30 Housing Starts Jul   580K 598K 582K   Aug 18 08:30 PPI Jul   -0.2% -0.2% 1.8%   Aug 19 10:30 Crude Inventories 08/14   NA NA +2.52M   Aug 20 08:30 Initial Claims 08/15   550K 553K 558K   Aug 20 10:00 Leading Indicators Jul   0.6% 0.6% 0.7%   Aug 20 10:00 Philadelphia Fed Aug   1.0 -2.0 -7.5   Aug 21 10:00 Existing Home Sales Jul   5.10M 5.00M 4.89M

Current views, speculations and suggestions

(good till close of business today). These are technical in nature only.

 

Sept Yen: pos with support at 105.57

Sept Swiss: positive with support at 93.10   

Sept EC: positive with support at 141.27   

Sept Canadian: neg with res at 91.75

Sept BP:  neg with res at 166.30        

Sept ES: pos with support at 983.00

Sept NQ: pos with support at 1575.50  

Sept Mini Dow: pos with support at 915.00

Dec Gold: potential reversal day     

Sept Silver: neg with res at 14.18  

Sept Copper: pos with support at 267.00  (but see trade of the week below

TRADE OF THE WEEK

As of 8.18 1:08 pm Ny time

Copper may be topping out in classical ways.

Head and shoulder top may be forming with the right shoulder seeing a doji day even as the dollar is weak on Tuesday and crude rallies.

Sell 278.00 with a stop at 281.75

Look for 255.00

 

 

Sept crude: expires today

Oct Crude: res at 75.50      

Nov Soybeans: neg with res at 9.70

Dec Wheat: neg with res at 5.045

Sept Ten Year:  pos with support at 117.16   

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International Markets

Sept Bund: pos with support at 122.25

Sept Dax:  neg with res at 5344

NKD: neg with res at 104.33  

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N.B.: if you initiate a trade using ANY of these numbers use a STOP at least equivalent to 2 ½%. Repeat: use Stops.  Don’t think about using Stops. Use Stops. Some find it appropriate to look at the margin requirement and use that as a stop or if it’s a steep initial requirement, use half.

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Charles Kespert

 

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HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, AL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETIOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.