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 finally bounced off the 2600 major area of support and resistance in yet another week of volatile trading activity.
The strengthening US Dollar and a generally strong economy may have potentially helped the buyers re-enter the market last week, as the key support level around the 2600 mark provided a precise entry point for strong buying.
Price remains volatile, however, making it potentially susceptible to near and long-term support and resistance levels and other fundamental catalysts. On Friday we saw the market find strong resistance at the 2750 level, but if buyers remain strong in the early part of this week, we may potentially see the market retesting the all-important 2800 support and resistance level.
We still see the 2800 level as a very decisive one for the market. More resistance at this level could continue to feed uncertainty to the market, while a confident break to the upside may potentially help resume the uptrend we witnessed for the market for the bulk of this year.
Light Crude Oil Futures (CL)
Light crude oil futures market dropped for the fourth consecutive week as fears of oil supply shortage faded away.
Sell side momentum also brewed in part from fundamental catalysts, with the US saying it will spare eight jurisdictions from getting affected by Iran sanctions for the time being.
On the technical front, we see the point of selling for last week line up perfectly with the confluence of the pullback point of the support trend line and a the support and resistance level at and around the $68 level, of course making a strong point for the major bearish activity we witnessed in the market last week.
Of considerable interest to us was the lack of support from the $64.5 crucial level making profound statements about the strength of the selling last week. If this momentum continues, we see $60 as a realistic target for this week, given the $64.5 level provides the needed resistance to cap any attempts from buyers to take over the market.
Gold Futures (GC)
Futures market for Gold failed to break past the tight support and resistance zone it seems to be caught up in, however, a noticeable increase in volatility may potentially be telling of an impending breakout sometime soon.
Resistance coming in at the 1240 level and support at the 1210 level continues to restrain price throughout last week as we witnessed attempts from the market to test both the levels, with relatively increased volatility, yet to no avail.
However, the increased volatility, especially the noticeable bullish action on Friday last week, may potentially be indicating an impending breakout sometime soon. Given the market’s close being perilously close to the 1240 resistance, the first few trading sessions this week may potentially hold the key for how the market sets up for the rest of the week.
Euro Currency Futures (6E)
Euro currency futures market last week again stayed well away from the $1.16 support and resistance level that in the recent past had been acting as a center point for a notorious sideways consolidation phase, but we are still looking at a rather cautious market.
As expected and hinted last week, the market did find valuable support at the 1.133 support level, but the market still closed relatively bearish for the week, which makes the bearish theme that we have been touting still very valid.
We noticed sharp resistance coming in late last week at the 1.15 level which appears to be a good sign for sellers. As long as we find 1.15 and other support and resistance levels higher continue to provide resistance for the market, we could potentially see more bearish action for the market going into this week. If so, that would be a move farther away from the 1.16 level (and hence also farther away from the notorious sideways consolidation phase) and more in line with the longer term down trend.
10 Year US Treasury Futures (TY)
The market for 10 year US treasury notes last week posted some interesting action, as we saw price reacting rather accurately to major and minor support and resistance levels in close vicinity.
Last week we had indicated that the resistance failure at the 118.3 level could possibly spell hard times for sellers, but we noticed the market finding strong resistance at the critical 119 price level, setting a very strong bearish tone for the majority of the week.
Notably on the way back we did not see price finding much trouble moving past the 118.3 level thereby allowing for a strong bearish close for the week. Should this momentum continue going into this week, we may see more development with regards to the market moving towards the resumption of the long term downtrend.
There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.