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Tuesday 29th of January Market Report

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Tuesday 29th of January 2013 as of 11:00 CET

The S&P500 futures trading down 1.50 points at 1495.50 this morning and Dax futures are down 9 points at 7828.

 

Asia equity markets: Shanghai up 0.91%, Australia’s S&P/ASX 200 up 1.11% and Nikkei 225 up 0.39%.

 

Asian markets were higher overnight after better than expected economic data out of the region. South Korean manufacturer’s confidence rose and Australia's business sentiment climbed by the most in a decade. In Japan, Mitsubishi UFJ Financial Group rose almost 3% after local press reported the group will report a 9 month net income which will exceed 500bn Yen.

 

German consumer confidence just came out pretty much in line with forecasts.  EU's Rehn says that the EU may ease targets for Spain if their economy deteriorates, but sees growing confidence. In corporate news Philips have released earnings better than forecasts and have reiterated their FY targets.

 

In the US markets were modestly lower last, despite a much better than expected durable goods order figure and better than expected earnings from Caterpillar, although their guidance was somewhat cautious. The Fed begin their 2 day policy meeting today and worth highlighting that the 10 year treasury yield traded at 2% yesterday following the economic data release. Today we have numbers from Ford (25c), Pfizer (44c) and Amazon (27c). We also have Case Shiller data and consumer confidence that can both move the markets considerably.

Volatility in the S&P500 options market is a bit higher as we are moving towards the FOMC and the US nonfarm payrolls on Friday.

Technicals

Market

S&P 500 emini (ES)

Dax

Crude

Corn

Eur/Usd

Res 3

1512

7950

101.62

745

1.3517

Res 2

1504

7900

99.47

736

1.3500

Res 1

1500

7888

96.90

732

1.3483

Sup1

1490

7804

95.36

722

1.3420

Sup 2

1486

7758

94.85

714

1.3353

Sup 3

1482

7657

93.47

708

1.3260

ATM calls Vols. nearby month

11.58

11.11

20.95

20.55

8.44

100 EMA

1422

7397

92.67

726

1.3035

200 EMA

1394

7154

95.66

706

1.2962

14 Day avg. Volume

1206K

97K

135K

98K

264K

 

VIX closed up 0.68 points at 13.57 yesterday.

SPY/TLT spread: 32.47(highest level seen in months)

 

S&P 500 Emini futures – Made another higher high yesterday, trading to a high of 1500.  I still think it will make a move lower next, but calling a top is always very difficult.  First major target to the downside is now 1472 support. Keep in mind we have a big gap down to 1426 that is a worry for the bulls in the longer run.

Dax futures – It traded to a high of 7888 yesterday. This move has made a punch through the upper Bollinger Bands on daily chart (7850), which signals to me that we are overdone on the upside for the near term and we should back off a bit lower at least. The 200 day moving average is also 698 points below the current price. That also signals that price is getting a bit overbought. My first downside target is 7657 support.

Corn – The down move never came down to my entry zone below 710 and bottom out at 714. Trading back up above 730 now. It looks like we are either setting up for a break above 736 resistance or a failure just below 736. I will wait and see what the markets decide before I do anything in this market now.

Crude Oil (Feb futures) –   It traded to a high of 96.98 last week, breaking above the 200 day moving average and also punching through the upper Bollinger Bands. I am looking for a correction lower next to test the 93.50 support level next.

Euro – I still think it makes sense to sell towards resistance as I see this lower over more European debt problems. Near term target would be 1.3264 support.

Today’s Economic Calendar (CET):

15:00     US S&P/CS Composite-20 HPI y/y (exp. 5.5%)

16:00     US CB Consumer Confidence (exp. 64.8)

 

 

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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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