This past week equity markets rose as the underlying S&P index climbed 2.20 %. Above, the September S&P futures contract rose 1.92% for the week. During this rally we were able to step-in for a quick day-trade on Tuesday and a 3.4% gain.
Moving forward we still believe bias remains strong, for a downward move and therefore, we are poised for a short-term downward move.
Oil made a big move this week on the back of tensions in the Middle East. The August contract, pictured above, was up 8.83% for the week. We are currently Long the August contract from $55.50.
Although, we believe the longer term trend in Oil is upward, it would not be surprising to see some consolidation occur this week. We will be looking to remain with our current trade, with an eye towards protecting our current open-profits.
It was an active week in the Gold market as the August contract, pictured above, moved up 4.14%. This move was in conjunction with a rise in world tensions. We entered three trades this week in gold with the first two being closed-out at break-even while the third resulted in a 7.5% gain.
We like the strength Gold has been showing recently and we are looking for continued strength in the week ahead.
Agricultural futures were Flat to Lower this week as September Wheat, pictured above, was off -2.08% and November Soybeans climbed a very modest .42%. We were not active in these markets this past week.
Going forward next week, we are looking for further declines as the spring planting season gives way to the summer growing season.
Given the magnitude of last week’s decline and the lack of follow-through in the recovery on Friday, there is potential for further market decline. With this in-mind we will be watching downward momentum early in the trading session, to gauge the potential for further profitable trades from this market correction.
Ahead of today’s Fed decision, Tuesday was a volatile day as volumes were low and we saw an early day rally fizzle-out. We remain Long the S&P with the market having already baked-in a rate hike today.
The recent advance in the June S&P contract ran into consolidation as investors became uncertain amid continued political trade uncertainties. I took profits this week and remain on the sidelines awaiting the next market move.
This week the S&P remained range-bound with a brief move to the downside on Thursday. We were able to enter the market for a day trade & capture profits during this brief move but remain Flat today looking for a major move in either direction.
With support established around 2552 and resistance at 2680 being repeatedly tested, the market appears to be setting-up for a move higher. The question is will this market desire to move higher out-weigh the influence of world political events.