How is your weekend so far? I hope everyone had a good one and wishing a Happy Fathers Day to all the daddies out there. Gosh I miss my family.
Alright lets move on to business.
In last weekend's update, we said that we are now entering into a sideways market and we were right. It was quite tough to grind out profits in the local market but we had a positive week nonetheless. I'm just glad the triple-witching is over and we can now resume back to normal trading until the next cycle 3 months from now.
This week looks like it is going to be another tough ride so be forewarned. We have the Greece crisis, G20 meeting, FOMC, and a host of other important data on the US economy. Alright lets hit the charts.
S&P 500 Futures - /es
We traded to these following levels last week:
Opened: 1337
High: 1342
Low: 1297
Closed: 1338.25
Our levels for last week was:
Possible Weekly Upper Range: 1355 and a small outside chance to touch 1374 if we have good news.
Possible Weekly Lower Range: 1240 and a small outside chance to test 1220 should we break down further.
If you haven't read our last week's update, you can click here.
Last week, we said that we are entering into a sideways market and we were right. The weekly bar closed as a sort of a dragonfly doji looking bar. This basically signifies a balance between buyers and sellers as the opening and closing price are very close to each other. We also said that the 1336-1350 area are very strong resistance area and we never went beyond the 50 level and closed at 1338.50.
On the daily chart, you can actually see an inverted head and shoulders forming and last Friday's up push actually is going to test the neck line of the pattern. We will see if price can break the neck line and whether a rally follows or will there be further sideways price action.
On the daily chart, we have just closed above the 50ema. Should we continue to trade above the 50ema, then perhaps price might have a good chance to go back up to higher levels of resistance. Of course, all of these also depends on what is happening on the macro-economic level too including what unfolds our of the euro zone crisis.
On the weekly chart, the closing price for this contract is just above the 22ema. For price to go up, we need to be trading above this ema and break through the 1350s level with conviction. Therefore, we will be following price closely to see if we can do that, and if not, then we will trade the failure accordingly.
Its a tough call on what the direction of the market is. A high probability is that we remain in a sideways market for a while more. It is tempting to say that things are looking good and the charts are pointing upwards after last week's rally back from the low. But with so much uncertainty in the market now internationally, I think the market will be trading cautious and I don't think that people will be going hands down and fully invested in such market so I think a two sided market is likely.
Look to our morning updates for the latest tidbits.
Here are the probable range for next week:
Possible Weekly Upper Range: 1375
Possible Weekly Lower Range: 1270
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Lets move on to the CME grains that we are tracking.
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Soybean Oil Futures
We traded to these following levels last week:
Opened: 49.55
High: 50.38
Low: 47.76
Closed: 48.60
Our levels for last week was:
Possible upper weekly range is: 52
Possible lower weekly range is: 47
So traders, what do you think about this commodity?
Last week's green bar gave some hope to the buyers but we were not able to push up through the resistance. Last week, we mention that if price wants to go up, it needs to push beyond the 50s level preferably above the 52 level and close above around the 50s levels for a positive confirmation that the buyers are in this fight. We did go up to test the 50.38 level but could not overcome it and close at 48.60, which is below our 50 level criteria.
So, the question is, what is up for next week?
If you look on the weekly chart, we are basically just chopping sideways between the range of 50s and 47s. That is basically a consolidation pattern. Which is a good thing because price has at least halted its sharp decline since April. With last week's inability to push up, I think we are headed to further sideways price action until a break out occurs.
Any break down from here should be met with support from the 200ema level of 47 and the lower major trend line at 45. Any break up should be met with a host of resistance as well.
We will follow this commodity closely and look at where price eventually breaks out and that would give us a hint on where our FCPO is headed too.
Here are the weekly ranges for next week:
Possible upper weekly range is: 52
Possible lower weekly range is: 47
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Soybean Futures
We traded to these following levels this week:
Opened: 1426
High: 1449.25
Low: 1372.75
Closed: 1379.75
Our levels for last week was:
The possible upper weekly range is: 1480
The possible lower weekly range is: 1330
Last week we mention that we wanted to see if price would test the 1450 level and is yes, whether it could break above it to test the next resistance area.
Price did go up to test the 1450 area and made a high of 1449.25, but could go no further.
We then traded down and close near the lows of the week at 1379.25.
I want to highlight that 1450 and 1300 is the choppy zone for this commodity for almost two third of the beginning of last year. I am looking to see if price would go back to being choppy in this 1450-1300 level just like before since we are now already trading in this range.
As for next week, the 1450 remains the resistance to break should we push upwards. With no continuation of last week's strong performance, I'm afraid we are looking for this contract to be trading sideways in this range too.
We will follow price closely and let the market runs its course.
Here are the weekly range for next week:
The possible upper weekly range is: 1450
The possible lower weekly range is: 1300
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Wheat Futures
Price traded to these following levels last week:
Opened: 629.25
High: 642.25
Low: 607.50
Closed: 612.50
Our levels for last week was:
The possible upper weekly range is: 680
The possible lower weekly range is: 591
Price for this commodity continues to be consolidating so there is not much that can be derived from it at this moment until a decisive break out occurs. Price for this contract is also trading sideways and is within our expected range.
Any break down would be met with support and any break up will be met with resistance as well. There really isn't much that we can get out of this chart at this moment other than following its intra-day price action.
Here are the weekly range for next week:
The possible upper weekly range is: 685
The possible lower weekly range is: 585
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Corn Futures
This commodity traded to these following levels this week:
Opened: 598.50
High: 608.50
Low: 575.50
Closed: 583.25
Our levels for last week was:
Possible upper weekly range: 640 and an outside chance to touch 660 if we rally further.
Possible lower weekly range: 542
The price of this commodity also traded within our range for this week.
Essentially, we are now trading sideways and back into the choppy range too. Not much trend could be derived from the charts until we move out of this sideways chop. Any break down should be met with support at the 200ema level at about 542 area.
So we can just use the intra-day price action for this commodity for our FCPO trading purposes.
Here are the levels for next week.
Possible upper weekly range: 640
Possible lower weekly range: 542
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That's all folks. See you all in the daily updates.
Ciao and take care!
Best Wishes,
Tech Trader
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