The following Commodity Futures Market Analysis is the opinion of Optimus Futures. Click on the charts below to enlarge it.
S&P 500 Index Futures (ES)
Last week the S&P 500 Emini futures market continued with the upward rally, pushing past important support and resistance levels, although a late announcement from the Federal Reserve levied some negative sentiment on the market.
The Federal Reserve on Thursday kept interest rates largely unchanged as part of a unanimous decision reflecting the bank’s continued attempts at trying to tighten the monitory policy.
However, the announcement on Thursday came well after the market had already pushed past the critical 2800 round number and support and resistance level that we had cited last week as an important level for the market. The weakness coming in the last two days meant the market closed just about at the 2800 level which, if turned into support, can allow a fresh Launchpad for buyers early this week.
However, we still see the market stuck in a rather high volatility period of trading and therefore would be interested in seeing formidable evidence of the market finding support at the 2800 level before we anticipate a move back towards the recently posted all-time high, and price levels beyond.
Light Crude Oil Futures (CL)
Light crude oil futures market built on the downward momentum some more last week, as the market matured into a textbook style breakout-pullback-continuation play underneath the critical rising support trend line.
We notice the market as it closed on Friday is very close to a long-term support and resistance level around the $60 major round number which has also been highly quoted by analysts across the board as a psychological level for crude oil prices.
However, looking at the strong momentum heading up until the close on Friday last week, we suspect the $60 level will be heavily tested by the sellers early this week and a quick burst past that level could clear way for lower price levels, potentially as low as the $54 support and resistance level (see chart above).
Gold Futures (GC)
Futures market for Gold continued to post higher trading activity last week as the market tests the tight range that it apparently is stuck in.
After what can be termed as a slow start to the week, the sellers were able to generate relatively serious momentum in the latter half of the week as resistance at the 1240 area proved far too strong for the rather indecisive market, and weak buying pressure.
What’s more, we notice a strong bearish close almost on the 1210 support area that has been acting as the floor for the recent tight consolidation phase, and therefore makes for very interesting first few trading sessions this week. Should this bearish momentum continue, we see a potential break of the 1210 support area, which should bring the rising support trendline into the equation as a possible next hurdle for sellers (See chart above).
Euro Currency Futures (6E)
Euro currency futures market continued to largely consolidate last week, however developments in the latter half of last week suggest sellers could well be gearing up for some near-term domination.
The week prior to last week, we had discussed the market finding support at the recently created swing low around 1.1333. Buyers however only barely managed to pull price back up towards the high profile support and resistance area around the 1.16 price level where precise resistance provided more strength and momentum to sellers. The market yet again closed strongly at the 1.1333 level, which marks the third test of the level in a short period of time, with each test resulting in a relatively lower intensity bounce/reversal.
We see this action as a sign of sentiment possibly shifting to sellers more than the buyers, and as such suspect, the 1.133 level may potentially break to the downside allowing for an easier path for sellers to take price further down south.
10 Year US Treasury Futures (TY)
The market for 10 year US treasuries last week posted rather neutral trading activity, and whilst trading lower than the former consolidation phase, momentum either ways appears missing still.
Last week, the market apparently found solid support around 117.2 level as it pulled back to the all-important 118 round number and support and resistance level (See chart above). Even as price was initially bearish last week, the action was far from convincing with candlesticks only barely closing bearish with large wicks to the upside suggesting bullish footprint.
We see continued weakness in this market going into this week, as price remains vulnerable around short and long-term support and resistance levels.
There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.