Yen Up, Dollar Down
It didn’t seem like it at first, but when Japan added 130 billion to to quantitative easing programs overnight, it was actually sending a negative signal. The YEN rallied, the dollar sold off, and crude oil sold off hard.
At 9:30 CT when the crude oil inventories (API) were released, crude oil futures (CLU16:NYM ) were trading around the $40.64 level, at 10:41 CT the futures had dropped all the way down to $39.38. Prior to that the ESU16 made an early high at 2171 on Globex and sold off all the way down to and early low of 2145.00. The futures proceeded to rally up to 2150.50, sold off again, retesting the earlier low, and put in a new low at 2141.50. After the retest the ESU16 traded back up to 2153.25, a lower high, as crude oil meandered lower.
Over the last several weeks, it didn’t matter to the S&P when crude oil was selling off, it did yesterday though.
At 11:45 CT the S&P 500 futures (ESU16:CME) were down -0.76%, the Dow futures (YMU16:CBT) were down -0.57%, and the Nasdaq futures (NQU16:CME) are off -0.98%.
The PitBull sent me this just as a 12:00 sell program hit the ES:
12:54:37 PITBULL: feels like they want to puke again. The next move was down to new lows at 2143.25 a few minutes later and the eventual low at 2041.50.
Gold Up, Crude Down
Everything was moving yesterday. There was economic and earnings news, and weakness in Asia spilling into Europe. Along with the flunk in equity futures, the US Dollar futures index tanked. The dollar index has seen strong outflows for several days now, along with crude oil which is now down 20% from the May highs, which places that market back in bear market status. Meanwhile, gold futures (GCZ6:CMX) have seemed to be building a higher base, and traded up to 1374 yesterday, just $3 from the July highs.
Overnight global equity markets continued to be offered lower. The S&P 500 futures traded sideways to lower throughout the Globex session making a 2153 high on the session open. That high was touched again early in the Asian session and traded lower from there. The ES is currently trading at 2148.00, down 4 handles on the session, with volume hitting over 150K at 6:15 am cst.
The 2152-2155 area showed up as support for much of the last couple weeks, and it looks like after breaking through that yesterday, this former support area is being converted into resistance. The late day bounced stopped there, then the globex highs were unable to overcome this level, and now the spoos are trading lower. For MrTopStep, this 2155 area becomes the pivotal level, and if unable to re-acquire this price early in today’s session, then it looks like the 2120 price may be reached by NFP.