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Posted by on in Uncategorized

Monday 22nd of October 2012 as of 13:00 CET

We had a weak close in the equities on Friday in the US as we broke weekly support levels and flushed lower towards the close and S&P 500 index closed down by 1.66% and Nasdaq down a whopping 2.19%. Futures are pointing higher this morning and S&P 500 Emini futures are up 5.75 points or 0.40% at 1429.75 the time of writing. Dax futures are up 13.50 points at 7382.

I am looking an interesting piece from Bloomberg this morning, saying that S&P 500 has beaten every other asset class year to date and is up 14 percent this year. Last time this happened was in 1995 according to Bloomberg and then the index gained another 93 percent in 2 ½ years.

 

U.S. Stocks Top All Other Assets for First Time Since ’95 - Bloomberg

http://www.bloomberg.com/news/2012-10-21/u-s-stocks-beating-all-other-assets-for-first-time-since-1995.html

 

The major point to have in mind in the current market is that we can go quite some distance both directions I figure.  I don’t think one should look too closely at the underlying economics, because it is the investor sentiment looking forward the will likely dictate the performance over the next 6 months.

 

Asian stock markets closed mixed with Shanghai up 0.39%, Australia’s S&P/ASX 200 down 0.66% and Nikkei 225 up 0.09%.

 

Today we will see earnings from among others Caterpillar, Freeport-MCmoran, SUN Bankcorp, Texas Instruments and Yahoo.

Full earnings calendar can be found here at Bloomberg: http://www.bloomberg.com/apps/ecal?c=US

 

Technicals

Market

S&P 500 emini (ES)

Dax

Crude

Corn

Eur/Usd

Res 3

1454

7500

93.84

791

1.3183

Res 2

1443

7482

93.01

777

1.3147

Res 1

1437

7452

92.86

768

1.3083

Sup1

1423

7332

90.65

745

1.3016

Sup 2

1416

7220

89.71

735

1.2944

Sup 3

1397

7207

87.52

703

1.2831

ATM calls Vols. nearby month expiration

14.44

15.24

30.46

24.48

9.33

100 EMA

1396

6983

90.28

728

1.2770

200 EMA

1359

6760

87.07

685

1.2892

14 Day avg. Volume

1647K

113K

174K

97K

231K

 

S&P 500 Emini futures – The rally failed just short of 1460 last week and we ended the week on a weak close. Most likely we will continue to see sellers on rallies at least early part of the week. Key support level is 1423 and 1416. If we break above 1437 resistance we could see another spike higher. Volatility is a bit higher across the board, but not that much higher compared to how much the VIX spiked higher on Friday.

The VIX closed up 2.03 points at 17.06  yesterday, which is in highest level seen since 9/6. Seems to be a bit overpriced compared to what the volatility in the S&P500 options market is suggesting.

Dax futures – It has held up relatively well over the last days compared to S&P 500 futures.  It has failed up towards 7400 level a few times before and it would be strong if it could close above 7400 today.

Corn –Key support is now 735 and the next big resistance level is 791 that is the top from 14/9. We have minor resistance at 768 and the previous top from last week at 777. I think buying low volume pullbacks makes sense today.

Crude Oil – Pretty much same outlook as last week. I think we need to get above the 93.84 key resistance to get things moving higher.  Below 93.84 it looks vulnerable to sell the rallies concept. Indeed sold down to test 89.71 support overnight. I have no big ideas for today.

Euro – It was not able to take out the key resistance of 1.3184 so far, the last reaction high. If that level is taken out we will be heading for 1.34. We are also below the previous break out level of 1.3079 and it looks a bit like we will drift lower towards the key support at 1.2948.

We don’t have any major economic releases today from the US, but we have Feds Pianalto speaking at 19:30 CET.

Today’s Economic Calendar (CET):

19:30     Feds Pianalto speaks

 

Contact info:
Trading Desk                                            

Tel:        +47-40 38 27 52

Email:    This email address is being protected from spambots. You need JavaScript enabled to view it.

Web:     www.kbrcapitalpartners.com

 

Risk Warning:  

Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by KBR Capital Partners AS with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Prices can go down as well as up. There is a significant risk involved in derivatives trading, including the risk of loss greater than the original investment. Past performance is no guarantee of future results.Conditions can vary from client to client, and therefore influence performance. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice.

 

 

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Posted by on in Uncategorized

Thursday 18th of October 2012 as of 10:30 CET

S&P500 futures down 1.50 points at 1455.50 at the time of writing and Dax futures are trading higher by 11.50 points at 7410. The reaction off those resistance levels in S&P500 futures and Dax yesterday was not much to celebrate for bears and I see risk for this move to continue higher. The big Joker card today is the EU Summit in Brussels, where EU leaders will discuss further measures to help the debt crisis.  Any negative comments out of the Brussels could send the markets much lower, so keep an eye open for that.

Chinese 3Q GDP data out overnight was in line with estimates at 7.4%. However, other Chinese data out overnight did come out better than expected; industrial production for September (9.2% versus expectation of 9.0%), fixed asset investment (20.5% versus 20.2%) and retail sales (14.2% versus 13.2%). It seems that the recovery in Asia is picking up and US Housing market data out yesterday also showed that building activity is picking up by 15%M and building permits increased by 11.6%M.

I read more and more comments from traders on the JPY and how we should see some more aggressive stance by the Bank of Japan at the next meeting 30th of October. I have seen talks about unlimited QE as a way to spur weaker JPY.  I am not trading the JPY at the moment, but I continue to follow the discussions. Today we will see earnings from among others Blackstone, Google, Microsoft, Morgan Stanley Philip Morris, Rambus and Verizon. The Euro is still above the 1.31 mark and overall the action taken by the EU politicians last days seems to be putting a continued bid into risk as the moment.

Asian stock markets closed higher with Shanghai up 1.53%, Australia’s S&P/ASX 200 up 0.69% and Nikkei 225 up 2.00%.

 

European Stocks Are Little Changed Before EU Leaders Meet - Bloomberg

http://www.bloomberg.com/news/2012-10-18/european-stock-futures-little-changed-before-eu-summit.html

 

EU Tussle Over Costs Threatens to Derail Bank Union Plan - Bloomberg

http://www.bloomberg.com/news/2012-10-17/eu-tussle-over-costs-threatens-to-derail-march-toward-bank-union.html

 

Technicals

Market

S&P 500 emini (ES)

Dax

Crude

Corn

Eur/Usd

Res 3

1466

7500

93.84

777

1.3204

Res 2

1462

7482

93.01

768

1.3184

Res 1

1458

7417

92.31

753

1.3140

Sup1

1443

7380

91.12

734

1.3079

Sup 2

1439

7220

89.71

731

1.2944

Sup 3

1434

7207

87.52

703

1.2831

ATM calls Vols. nearby month expiration

15.15

13.17

29.40

22.61

11.13

100 EMA

1393

6947

91.15

727

1.257

200 EMA

1354

6716

89.14

683

1.2876

14 Day avg. Volume

1647K

111K

184K

104K

241K

 

S&P 500 Emini futures – It broke above the key resistance at 1454 yesterday and we got up to 1457.75 yesterday. Plenty of resistance levels from here and up to the yearly high at 1468.75. If this is a strong market we should see a pretty fast move from here and up through the 1468.75 level. There is of course a risk for a potential failure up in this area.

The VIX closed down 0.15 points at 15.07 yesterday, which is in the lower end of the recent 7 days range.

Dax futures –Dax has not been able to sustain above the previous reaction high of 7417 so far and looks a bit toppish unless we close above 7417 today.The next major resistance level is the yearly high of 7482.  If the market is strong we should not spend much time below 7380 level at all today and close higher than 7417. I favour buying low volume pullbacks today and especially early on in the day.

Corn –Key support is now 731 and minor support at 734 and the next big resistance level is 791 that is the top from 14/9. We have minor resistance a 753 and 768 and the previous top from last week at 777. I think buying low volume pullbacks makes sense today.

Crude Oil – All over the place last week and the underlying supply situation indicates lower prices is the most likely, but Middle East tensions is a potential big risk. I think we need to get above the 93.84 key resistance to get things moving higher.  Below 93.84 it looks vulnerable to sell the rallies concept. Seems to be stuck around the 92 level at the moment and I don’t have any big ideas for trading this one today.

Euro – It is trading above that key resistance of 1.3080 and the next major level to watch is 1.3184, the last reaction high. If that level is taken out we will be heading for 1.34. Major support is now the breakout level of 1.3079. Volatility is moving higher on the shorter end of the curve as the market is pricing in potential break higher.

Today’s Economic Calendar (CET):

14:30     US Weekly Unemployment Claims (exp. 367k)

16:00     US Philly Fed Manufacturing Index (exp. 1.3)

16:30     US Natural Gas Storage (exp. 35B)

 

Contact info:
Trading Desk                                            

Tel:        +47-40 38 27 52

Email:    This email address is being protected from spambots. You need JavaScript enabled to view it.

Web:     www.kbrcapitalpartners.com

 

 

Risk Warning:  

Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by KBR Capital Partners AS with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Prices can go down as well as up. There is a significant risk involved in derivatives trading, including the risk of loss greater than the original investment. Past performance is no guarantee of future results.Conditions can vary from client to client, and therefore influence performance. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice.

 

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Posted by on in Uncategorized

Friday 12th of October 2012 as of 12:00 CET

S&P500 futures are up by 3.50 points or 0.25% at the time of writing at 1432. The Euro has rebounded nicely from the 200 day moving average. We are moving towards the weekend and the earnings season is to get underway in full force. We have JP Morgan out at 13:00 CET and then later we have Wells Fargo & Co.

U.S. Stock Futures Advance as Treasuries Decline Before JPMorgan - Bloomberg

http://www.bloomberg.com/news/2012-10-12/asian-stocks-advance-with-regional-currencies-oil-yen-weakens.html

The market is waiting for the inevitable bail out of Spain to be announced any time now as Mr. Rajoy have to give in at some point very soon and officially request money from the EU. I think it makes sense to save Spain, but Greece is in a far more difficult situation and I think Greece will need another haircut on the debt to have any chance of surviving.

A bit interesting note from the Minutes out of the most recent meeting of the Bank of Japan. All members were concerned about the JPY strength, but at the end of the day nobody really was brave enough to do anything about it and they took a wait and see approach until the next meeting at 30th of October, hoping the market will fix their problem and weaken the JPY. It seems the market is disappointed by this message and the Yen is not going higher so far at least.

We will see China September trade data released Saturday morning and I am hearing from sources that the number will come in on the strong side and some are suggesting that export growth will be close to 10% and import growth of 2%. The market consensus is for 6% export growth and 2.4% import growth. If we see a number towards 10%, it will be in line with the recent rebound seen in Korea and Taiwan.

Technicals

Market

S&P 500 emini (ES)

Dax

Crude

Corn

Eur/Usd

Res 3

1457

7382

94.08

806

1.3083

Res 2

1443

7329

93.84

791

1.2990

Res 1

1439

7310

93.01

770

1.2974

Sup1

1428

7230

91.05

762

1.2910

Sup 2

1421

7207

89.79

731

1.2814

Sup 3

1414

7176

87.52

703

1.2766

ATM calls Vols. nearby month expiration

13.29

15.24

29.40

25.03

8.46

100 EMA

1390

6935

96.34

725

1.2626

200 EMA

1350

6715

98.69

680

1.2910

14 Day avg. Volume

1653K

111K

194K

107K

247K

 

Asian stock markets closed mixed with Shanghai up 0.09%, Australia’s S&P/ASX 200 up 0.07% and Nikkei 225 down 0.15%.

 

S&P 500 Emini futures – It closed below the key 1443 support level and we traded much lower closing at 1434, confirming the weakness I outlined yesterday. Key support is now 1423 that is the last reaction low, which if broken opens for 1414 first, then potentially 1388. Vols are higher this morning and above 14% mark on the ATM calls for October expiration.

The VIX closed down 0.70 points at 15.59 yesterday, which is in the middle end of the recent 7 days range.

Dax futures – We bounced off the major support at 7176 yesterday and we traded up to 7310, so seems to be plenty of buyers ahead of that key 7176 support level. It looks most likely the price will stay support throughout today and low volume pull backs looks attractive to buy. Key resistance level is still 7382.

Corn – Spiked much higher yesterday from the 732 support level and we are above the 767 resistance this morning. The next big level is 791 that is the top from 14/9. To me it looks the most interesting to buy low volume pullbacks for today as long as 762 support holds.

Crude Oil – All over the place last week and the underlying supply situation indicates lower prices is the most likely, but Middle East tensions is a potential big risk. I think we need to get above the 93.84 key resistance to get things moving higher.  Below 93.84 it looks vulnerable to sell the rallies concept. Buying low volume dips is my preferred way to play it today.

Euro – Trading like a yo-yo last sessions. It looks to me like the European debt crisis will continue to be the negative headline for the Euro and I question if we can get above the 1.3200 resistance level in the near term. Key support is 1.2814 that needs to hold to avoid a bigger sell off.

We have US PPI and Michigan Consumer Sentiment out today, along with bunch of earnings that can make the day rather volatile. Also watch out for comments out of Feds Lacker.

Today’s Economic Calendar (CET):

14:30   US PPI (exp. 0.8%)

15:55   Michigan Consumer Sentiment (exp. 78.1)

18:35   Feds Lacker speaks

 

Contact info:
Trading Desk                                            

Tel:        +47-40 38 27 52

Email:    This email address is being protected from spambots. You need JavaScript enabled to view it.

Web:     www.kbrcapitalpartners.com

 

Risk Warning:  

Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by KBR Capital Partners AS with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Prices can go down as well as up. There is a significant risk involved in derivatives trading, including the risk of loss greater than the original investment. Past performance is no guarantee of future results.Conditions can vary from client to client, and therefore influence performance. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice.

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