Post subject: May 27th Thursday 2010 Emini TF ($TF_F) points +8.60
Posted: Fri May 28, 2010 2:18 pm
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Joined: Sat Jan 10, 2009 2:06 pm Posts: 4342 Location: Canada
Trade Journal By M.A. Perry Trader and Founder of WRB Analysis (wide range body analysis)
Trade journals are crucial in preventing us traders from becoming complacent or content with our trading plan or the markets because without having the ability to review archives of past trading days in a forever changing market...we won't know it's time to adapt when change occurs in the markets because broker statements alone doesn't help us keep that edge in comparison to a trade journal. In addition, this public trade journal contains useful trading tips a few times per week to encourage readers to return for more information and to help ensure I myself don't forget the importance of basic concepts within my own trading plan. Further, there are market summaries from Youtube Bloomberg, CNNMoney and Yahoo Finance as a quick archive of what happened in the markets on a particular day of trading. Thus, if you're looking for trading tips and market summaries that can improve your trading and/or understanding of what happen on a particular day that involves more than just entry signals...consistently read this trade journal and the #FuturesTrades chat room logs where I post my trades in real-time from entry to exit (see link below) via my IRC user name wrbtrader.
Today's results are 9 wins : 12 losses (see above #FuturesTrades log). Most of my losses occurred within a low volatility trading range of 2.4 points that was also within a key WRB zone. It's very unusual for a key WRB zone to develop into low volatility trading range that spans several of my trades. Regardless, had a few key trades via the Volatility Trading Report (VTR) after those losses that was able to get me profitable for the trading day.
Trading Tip: Greed is only for those that have already reached their profit goals for the day and not for those that haven't reached their goal.
FYI - You can ask me questions here at the forum or you can tweet me on twitter about any thing related to today's trading or related to your own trading.
In addition, posted below are direct links about my trade methodology or trading approach that enables me to identify key trading areas in the price action that represent changes in supply/demand and volatility along with being able to exploit these changes via WRB Analysis (wide range body analysis).
NEW YORK (CNNMoney.com) -- U.S. stocks soared Thursday, with the major indexes gaining about 3%, after Chinese officials dismissed reports that they're reviewing their nation's investment in European bonds amid concerns about the continent's debt problems.
The Dow Jones industrial average (INDU) added 285 points, or 2.9%, and finished at 10,259. American Express (AXP, Fortune 500), Intel (INTC, Fortune 500) and Alcoa (AA, Fortune 500) led the advance, rising more than 5%.
The S&P 500 (SPX) index rose 35 points, or 3.3%, and the Nasdaq (COMP) composite increased 82 points, or 3.7%.
Stocks erased gains in the last hour of trade Wednesday, with the Dow finishing below 10,000 for the first time in three months, as the focus shifted from strong economic reports to lingering concerns about global economic recovery and the weakening euro.
But investors' confidence got a boost Thursday after China's State Administration of Foreign Exchange refuted reports that the country was reconsidering its holdings in European bonds, calling the claims "groundless."
"China has always firmly supported the EU integration process. We support the European Union and the International Monetary Fund package of financial stability measures being taken," said agency chief Yi Gang in a statement.
China holds $2.45 trillion of foreign exchange reserves, with U.S. Treasury debt and Euro zone government bonds making up key investments.
"The news out of China denying rumors that they're going to reevaluate their European assets sparked a nice rally," said Peter Cardillo, chief market economist at Avalon Partners.
Had the rumors been true, Cardillo said the euro would have crashed and sent markets into a free fall.
"That kind of move would have been detrimental for China, too," Cardillo said. "If Europe falls apart, so will the global economy." China bucks up the euro
Although worries about Europe's debt problems will continue, Cardillo said it's only a matter of time before fears subside.
The CBOE Volatility index, or the VIX (VIX), Wall Street's fear factor, sank more than 14%.
"With the facts we have now, we know Europe's troubles will impact economic activity on a global scale, but not by much and that's key," Cardillo said.
But markets could continue to remain volatile as investors remain jittery.
"Anytime we see moves of this kind of magnitude, even if it's positive, investors take a little more caution," said Russel Lundeberg, chief investment officer at Barrett Capital Management. "A nervous environment keeps volatility high."
Economy: The government revised its reading on first-quarter gross domestic product (GDP), the broadest measure of U.S. economic activity, to an annual growth rate of 3%. The figure was below expectations of 3.3%, according to a consensus of economists surveyed by Briefing.com. The initial reading, released last month, was a 3.2% rate.
But the revision also showed that the rate of consumer spending has doubled since the fourth quarter of 2009, and remains consistent with the forecast for annual GDP to grow between 3% and 3.5% in 2010, Cardillo said.
The Labor Department said filings for first-time unemployment insurance fell last week to 460,000 from a revised 474,000 the previous week. Economists were expecting claims to fall even lower, to 455,000.
Companies: Johnson & Johnson (JNJ, Fortune 500) executives told lawmakers that the widespread recall of children's Tylenol medicines earlier this month was a precautionary measure taken against "remote" health risks. But the Food and Drug Administration is investigating reports of at least 775 serious side effects from the recalled drugs.
Johnson & Johnson's stock was the only Dow component to slip into the red Thursday, falling 0.2%. Since the May 1 recall, the company's shares have fell more than 7%.
BP (BP) executives also took the hot seat on Capitol Hill in ongoing testimony about the Gulf oil spill. The company's shares soared 7% after an Oppenheimer analyst raised the stock's rating, saying that the recent sell-off has gone too far. Shares of BP have dipped 30% since the April 20 explosion.
Apple's (AAPL, Fortune 500) market capitalization overtook Microsoft's (MSFT, Fortune 500) for the first time in 20 years at the close Wednesday, making it the second most valuable company in the nation after Exxon Mobil (XOM, Fortune 500). Both tech giants added about 4%. 0:00 /2:26NYSE traders unbowed by sell-offs
World markets: Stocks around the world also advanced on the news from China. In Europe, the CAC 40 in France jumped 3.4%. Britain's FTSE 100 added 3.1% and the DAX in Germany also gained 3.1%
Asian shares also finished higher. The Hang Seng in Hong Kong and Japan's Nikkei added 1.2%. The Shanghai Composite gained 1.2%.
Dollar and commodities: The euro, which has seesawed since falling to a four-year low last week amid concerns about the region's economic stability, rebounded against the dollar, rising 1.5% against the U.S. currency.
The greenback was down 1.3% against the British pound, but it was up 1% versus the Japanese yen.
The weaker dollar gave momentum to oil prices. Oil for July delivery rose $3.04, or 4.3%, to $74.55 a barrel.
Gold for June delivery dipped $1.50 to settle at $1,211.60 per ounce.
Bonds: Treasury prices tumbled Thursday, pushing the benchmark 10-year note's yield up to 3.35%. Bond prices and yields move in opposite directions.
Trading volume: Market breadth was positive. On the New York Stock Exchange, winners beat losers nearly 13 to one on volume of just under 1.4 billion shares. On the Nasdaq, advancers topped decliners seven to one on volume of 2.4 billion shares.
4:35 pm : Stocks surged in high volume as market participants showed a willingness to take on risk after China conveyed a sense of confidence in Europe.
A positive tone permeated trade for the entire session. Many media sources said the initial catalyst was a denial by China about possible reviews of European debt holdings. Though that was interpreted as a vote of confidence in the continent that has caused so much concern related to systemic risk amid the persistent fiscal problems of Portugal, Italy, Ireland, Greece, and Spain, the news item doesn't do anything to change circumstances that currently face Europe.
Despite lingering concerns, Europe's major bourses still rallied in excess of 3% and the euro sprinted to a 1.5% gain against the greenback.
Domestic markets shared in the improved sentiment. The upbeat tone persisted for the entire session and even intensified into the close. In turn, the stock market settled at a session high with more than 98% of the names in the S&P 500 closing with a gain.
The strongest move was made by financials. They tacked on a collective gain of 4.5% as insurers and diversified financial services plays spiked.
Energy stocks were also especially strong. The sector climbed 4.2%. Higher oil prices helped as contracts for the energy component closed pit trade with a 4.2% gain at $74.50 per barrel. Oil prices have climbed more than 8% during the course of the past two sessions.
Advancing volume on the NYSE totaled almost 1.4 billion shares, which is close to the average total trading volume for the NYSE over the past 50 sessions. Advancing volume had a near 10-to-1 advantage over declining volume.
Though strong volume suggested that there was plenty of conviction behind the S&P 500's move above 1100, the stock market finds itself face-to-face with its 200-day moving average near 1105, which could be a point of significant resistance.
Treasuries had trouble this session. Specifically, the benchmark 10-year Note dropped more than one full point so that its yield climbed toward 3.35% after it had been down below 3.10% just two days ago. Treasuries failed to benefit from results of the latest 7-year Notes auction, which were generally solid.
Economic data got little more than a cursory mention amid this session's surge. The second estimate for first quarter GDP showed that the economy expanded at an annualized rate of 3.0%, which is down from the 3.2% increase that came with the advance estimate and below the 3.3% increase that many had come to expect.
Initial jobless claims for the week ended May 22 totaled 460,000, which is a bit above the 455,000 claims that had been widely expected. Continuing claims came down from 4.66 million to 4.61 million, which is in-line with what had been widely anticipated.
3:30 pm : Oil extended its rebound from the prior session so that it closed pit trade with a 4.2% gain at $74.50 per barrel. Oil prices have climbed more than 8% during the course of the past two sessions.
Natural gas prices also fared well, despite a midmorning pullback that followed a slightly larger-than-expected build in weekly inventories. Futures contracts closed with natural gas priced 2.7% higher at $4.29 per MMBtu.
Gold failed to find any sustainable support. Instead, it spent most of the session mired in negative territory with a moderate loss. It finished pit trade with a 0.2% loss at $1211.52 per ounce.
Silver was stronger. It settled 0.8% higher at $18.46 per ounce.
Overall strength among commodities helped the CRB Commodity Index spike 1.9% in its best percentage gain in almost two months. The move also helped put the CRB up more than 3.5% for the past two sessions; that's its best back-to-back performance this year. DJ30 +219.24 NASDAQ +69.80 SP500 +28.66 NASDAQ Adv/Vol/Dec 2283/1.90 bln/406 NYSE Adv/Vol/Dec 2849/996 mln/225
3:00 pm : Stocks recently extended their gains, but the move didn't have enough momentum to take the S&P 500 up to 1100. Instead, stocks have eased back a bit. Gains remain rich, though.
As an equity class, small-cap stocks have fared extremely well this session. Their collective strength has sent the Russell 2000 to a 3.4% gain. Strength among small-caps comes as market participants show a willingness to take on risk amid this session's buying effort.
Such confidence has caused the Volatility Index to drop 15%. DJ30 +218.63 NASDAQ +67.66 SP500 +27.42 NASDAQ Adv/Vol/Dec 2255/1.73 bln/421 NYSE Adv/Vol/Dec 2845/893 mln/224
2:30 pm : After spending the better part of the past few hours in a relatively narrow trading range, the stock market has made a move to fresh session highs. The latest leg of gains comes amid broad-based support, though financials (+3.7%), energy (+3.5%), and tech (+3.3%) have been the biggest contributors due to both percentage gains and market weight. Together, the trio accounts for more than 45% of the S&P 500's weight. DJ30 +237.57 NASDAQ +69.97 SP500 +29.53 NASDAQ Adv/Vol/Dec 2256/1.59 bln/405 NYSE Adv/Vol/Dec 2823/815 mln/228
2:00 pm : Strength among large-cap tech names like Apple (AAPL 251.17, +7.06), Microsoft (MSFT 25.92, +0.91), and Google (GOOG 489.96, +14.49) have given the Nasdaq a lead over its counterparts. Semiconductor stocks like Intel (INTC 21.66, +0.96) have also provided support to the tech-rich index; semiconductor stocks are up 4.3% as a group.
Though it is still up with an impressive gain, the Dow has trailed the Nasdaq and the S&P 500 by a modest margin for most of this session. Of its 30 members, only Johnson & Johnson (JNJ 58.94, -0.18) is in the red. The stock actually started the session in higher ground. DJ30 +207.00 NASDAQ +63.37 SP500 +25.53 NASDAQ Adv/Vol/Dec 2231/1.46 bln/427 NYSE Adv/Vol/Dec 2791/750 mln/251
1:30 pm : Results from an auction of 7-year Treasury Notes attracted a bid-to-cover ratio of almost 2.9 and an indirect bidder participation rate of roughly 51%. The previous auction drew a bid-to-cover ratio of 2.8 and an indirect bidder participation rate of almost 60%. For the past six auctions, the average bid-to-cover stands at 2.8, while indirect bidder participation stands at 50%.
Treasuries have been unaffected by the results. As such, the benchmark 10-year Note continues to trade with a loss of more than one full point. That has kept its yield a few basis points above 3.3%. Just two days ago the Note's yield was below 3.1%. DJ30 +216.44 NASDAQ +62.62 SP500 +25.76 NASDAQ Adv/Vol/Dec 2223/1.34 bln/398 NYSE Adv/Vol/Dec 2806/685 mln/226
1:00 pm : A broad-based buying effort has stocks on track for their best percentage gain in two weeks, thanks largely to continued strength among overseas markets and a bounce by the euro.
News that China denied any reviews of its European debt holdings acted as a vote of confidence in the continent, such that Europe's major bourses rallied for the second straight session. France's CAC has tacked on almost 6% during the course of the past two sessions, while Britain's FTSE has added more than 5% and Germany's DAX has advanced almost 5% during that same time.
Meanwhile, the euro has rallied after it retreated back toward its four-year low against the dollar yesterday. It is currently up 1.6% against the greenback.
A revived euro and a positive tone among global participants have helped drive domestic markets sharply higher in broad-based fashion. As such, all 10 major sectors in the S&P 500 are in higher ground; each sports a gain of more than 1%.
Despite such strength, Monsanto (MON 48.90, -3.76) is on pace for its worst single-session slide of the year. Its weakness is owed to the company's decision to trim its earnings outlook for fiscal 2010.
In a display of conviction, trading volume is strong this session. More specifically, a half billion shares have already exchanged hands on the NYSE. Advancing volume currently outnumbers declining volume by more than 10-to-1 on the Big Board.
With such a positive tone permeating action in the stock market, traders have dumped Treasuries. In turn, the benchmark 10-year Note is down more than one full point. Action among Treasuries could change with the release of results from an auction of 7-year Notes at the top of the hour.
Economic data has had little impact on trade. The second estimate for first quarter GDP showed that the economy expanded at an annualized rate of 3.0%, which is down from the 3.2% increase that came with the advance estimate and below the 3.3% increase that many had come to expect.
Initial jobless claims for the week ended May 22 totaled 460,000, which is a bit above the 455,000 claims that had been widely expected. Continuing claims came down from 4.66 million to 4.61 million, which is in-line with what had been widely anticipated. DJ30 +196.04 NASDAQ +59.69 SP500 +23.03 NASDAQ Adv/Vol/Dec 2224/1.24 bln/391 NYSE Adv/Vol/Dec 2785/632 mln/236
12:30 pm : Stocks are drifting sideways along their session highs. The strong and steady gains have caused a sharp drop in volatility, such that the Volatility Index (VIX) is currently down more than 13%. The VIX is still up roughly 40% year-to-date, though.
Treasuries have been pressured by the stock market's gain and the apparent decline in volatility. Specifically, the benchmark 10-year Note is down more than one full point. Action among Treasuries could change with the release of results from an auction of 7-year Notes at the top of the hour. DJ30 +200.87 NASDAQ +60.73 SP500 +24.26 NASDAQ Adv/Vol/Dec 2234/1.13 bln/374 NYSE Adv/Vol/Dec 2795/575 mln/217
12:00 pm : The stock market continues to trade near its session high as only a handful of names are weak with losses. In turn, stocks remain on track for their best single-session percentage gain in two weeks. Despite such an accomplishment, the stock market is up only slightly more than 0.5% week-to-date and down almost 8% month-to-date.
Keeping consistent with recent trends, trading volume is strong this session. More specifically, a half billion shares have already exchanged hands on the NYSE. Advancing volume currently outnumbers declining volume by more than 10-to-1 on the Big Board. DJ30 +213.19 NASDAQ +58.71 SP500 +25.35 NASDAQ Adv/Vol/Dec 2214/1.00 bln/370 NYSE Adv/Vol/Dec 2809/515 mln/193
11:30 am : The euro has extended its advance against the dollar so that it is now back above the $1.23 level, or up 1.1%. The euro is still down 14% against the greenback since the start of the year, though.
The euro's bounce has helped support this session's buying effort, since many traders have kept a close eye on the euro for its signals about the strength of the eurozone economy and the ramifications of a stronger dollar on profits of American companies with multinational operations. DJ30 +201.25 NASDAQ +57.76 SP500 +24.96 NASDAQ Adv/Vol/Dec 2164/881 mln/373 NYSE Adv/Vol/Dec 2803/450 mln/183
11:00 am : Stocks recently extended their gains, but they have since eased back a bit from session highs. The latest leg higher has been helped along by financial stocks, which recently sprinted ahead to a 3.1% gain. Multiline insurers (+4.2%) are some of the strongest players in the financial sector, but diversified bank stocks (+3.7%) are also up sharply.
The energy sector continues sport the best overall gain of any major sector, though. The energy sector is currently up 3.3% as oil and gas exploration companies (+4.1%) and oil and gas drillers (+3.7%) gain amid broader market support and renewed strength in oil prices, which were recently quoted with a 3.5% gain at $74 per barrel -- a two-week high. DJ30 +204.88 NASDAQ +57.89 SP500 +24.78 NASDAQ Adv/Vol/Dec 2165/725 mln/331 NYSE Adv/Vol/Dec 2773/371 mln/176
10:30 am : Oil prices have extended their gains from the prior session, such that the commodity was recently quoted at $73.75 per barrel, up another 3.1% this session.
Natural gas prices had shown strength in the early going, but prices for the energy component have since retreated from morning highs of roughly $4.28 per MMBtu to $4.16 per MMBtu, or down 0.3%, with the release of the latest weekly inventory data. Inventories for the week ended May 21 showed a build of 104 bcf, which is a bit above the expected build of 100 bcf.
Precious metals are mixed as the price of gold dips 0.2% to $1210.80 per ounce. Since the prior session futures prices for the precious metal have traded in a range from $1218.50 to $1205.40 per ounce. As for silver, the metal was last quoted 0.3% higher at $18.37 per ounce, just shy of its session high. DJ30 +205.18 NASDAQ +59.45 SP500 +25.01 NASDAQ Adv/Vol/Dec 2147/541 mln/283 NYSE Adv/Vol/Dec 2736/284 mln/173
10:00 am : Early gains are strong and broad based, such that more than 98% of the S&P 500 is in higher ground and all 10 of its major sectors are up with gains that range from 0.9% (telecom) to 2.4% (energy). However, Monsanto (MON 48.96, -3.70) has been under sharp pressure following the company's decision to trim its earnings outlook for fiscal 2010. Pressure against shares of MON is actually so intense that the stock is currently caught in its worst single-session slide of 2010, despite broader market strength.
09:45 am : The major equity averages are up sharply as a wave of buying boosts a broad range of stocks. Gains are currently most pronounced among energy stocks and tech stocks; both sectors are up 2.5% at the moment.
Such strength among stocks has caused Treasuries to fall under the sting of a sharp selling effort. Specifically, the benchmark 10-year Note is down a full point. In turn, its yield is now above 3.30% after it had been below 3.10% just a couple of days ago. DJ30 +167.24 NASDAQ +50.94 SP500 +21.39 NASDAQ Adv/Vol/Dec 2071/215 mln/230 NYSE Adv/Vol/Dec 2690/122 mln/105
09:15 am : S&P futures vs fair value: +17.70. Nasdaq futures vs fair value: +34.00. Though imperfect indicators, stock futures suggest that the S&P 500 will open trade with a gain of roughly 2%. The upbeat tone comes amid strong buying overseas following news that China has denied that it is reviewing its European debt holdings. China's vote of confidence has also helped the euro make its way higher after it returned to near four-year lows against the dollar yesterday. The positive tone to premarket trade persists in the face of a softer-than-expected increase in first quarter U.S. GDP. However, both weekly initial jobless claims and continuing jobless claims were generally in-line with expectations.
09:00 am : S&P futures vs fair value: +16.00. Nasdaq futures vs fair value: +32.50. Europe's major market averages are up sharply for the second straight session. The renewed buying effort comes amid news that China is not reviewing its European debt holdings. All 30 of the components in Germany's DAX are in higher ground. BASF is a primary source of strength, but collective gains have boosted the bourse to a 1.9% gain. In France, the CAC has climbed 1.7% amid broad-based buying. Of its 40 components, only Credit Agricole and Total (TOT) are currently in negative territory. The FTSE, Britain's primary stock index, is up 1.7%. Man Group is currently its best performer by percent gained, but BP Plc (BP) is a primary leader due to its market weight. Asia's major market averages booked strong gains of their own. Japan's Nikkei made its way 1.2% higher. Fanuc and Tokyo Electron were primary sources of support, but Fast Retailing was a bit of a drag on trade after it had rallied in the previous session. Hong Kong's Hang Seng worked its way 1.2% higher. Energy company CNOOC (CEO) was a primary leader in that move. Financials issues also provided support, though Bank of China was weak. In Mainland China, the Shanghai Composite climbed 1.2%. PetroChina (PTR) was one of the top performers, but Industrial & Commercial Bank of China was weak.
08:35 am : S&P futures vs fair value: +15.00. Nasdaq futures vs fair value: +31.30. Stock futures are off of their morning highs, but they continue to trade with strength in the wake of the latest dose of data. The second estimate for first quarter GDP showed that the economy expanded at an annualized rate of 3.0%, which is down from the 3.2% increase that came with the advance estimate. It is also below the 3.3% increase that many had come to expect. Meanwhile, initial jobless claims for the week ended May 22 totaled 460,000, which is a bit above the 455,000 claims that had been widely expected. Continuing claims came down from 4.66 million to 4.61 million, which is in-line with what had been widely anticipated.
08:00 am : S&P futures vs fair value: +18.70. Nasdaq futures vs fair value: +34.80. Stocks rolled over to log a loss for the prior session, but that didn't undermine Europe's major bourses, which have rallied for the second straight session. The extended buying effort in Europe follows word that China is not reviewing its holdings of European debt. The story has also helped the euro climb after it fell back near its four-year low against the dollar yesterday. The euro's bounce and continued gains among overseas markets have helped send U.S. stock futures sharply higher. That has put added pressure on Treasuries, such that the yield on the benchmark 10-year Note is now near 3.30% after it had been below 3.10% earlier this week. Treasuries will remain in focus with the release of results from an auction of 7-year Notes at 1:00 PM ET. Before that, market participants get their hands on the second estimate for first quarter GDP and the latest weekly jobless claims count at 8:30 AM ET.
06:51 am : S&P futures vs fair value: +21.00. Nasdaq futures vs fair value: +40.80.
06:51 am : Nikkei...9639.72...+117.10...+1.20%. Hang Seng...19431.37...+234.90...+1.20%.
06:51 am : FTSE...5140.44...+102.30...+2.00%. DAX...5900.20...+141.20...+2.40%.
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