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Hey Traders,
The anticipation of a softer CPI combined with the actual soft CPI released fueled a strong market risk on euphoria earlier on the week. However, all was lost when Powell gave his speech during his speech. His stance was that it is beneficial to have a harder landing compared to a softer landing. This was also emphasized a couple of months back. This is also one of the key reason that the financial market is fueled by the emotions and expectations of market participants and not entirely on fundamentals.
Upcoming Economic Release:
S&P500 Futures
The latest weekly candle of the S&P500 looks grim. The 4150 region which was identified as one of the potential resistance and the index rejected hard from it. Price fell back to below the descending trend line and even broke pass the 3915 support region. Bearish momentum is likely to take a pause before heading towards 3815 support region. However, if price climbs back to above 3915, reaching back 4000 is a possibility.
Dollar Index (DXY)
The United States Dollar Index although recovered some of its losses, is still below the descending trend line. Even though the Dollar is trading below the 105.0 key level, price is still trading relatively close to the level. Upside potential is still possible if the Dollar managed to trade above the 105.00, invalidating the descending trend line and shifting the 105.00 level from resistance back to support level.
Gold Futures
We have emphasized a slow down in momentum of Gold. Gold has been trading in consolidation between 1790 and 1820 region. The daily 50 exponential moving average is not as extended as before and price is likely to make its first contact with the moving average before heading higher due to seasonal strength. A breakout of the 1790 support region can potentially push price towards 1747 while a breakout of the 1820 resistance region can potentially push price towards 1850 region.
Trade Recap
Corn Futures (Analysis 50-2)
Recap (Week 50 - Last Week) Stopped
Corn Futures short at market reopening position got stopped out.
Trade Analysis / Setups
Sugar #11 Futures - Front Month (Analysis 51-1)
Analysis: Price has reversed back to within the range where we believe price will begin trading back towards the bottom of the range. We identify the 19.6 region at minor support where we set as our initial Take Profit level as price can also potentially trade back up.
Short opportunity: At market reopening towards 19.59 as Take Profit - 1 level.
Corn Futures - Front Month (Analysis 51-2)
Analysis: Price has begun trading in consolidation where we will look for breakout and retest confirmation before trading along with the direction of the breakout.
Long opportunity: Break and retest confirmation at 655.5 resistance region towards 671.5 as Take Profit - 1.
Short opportunity: Break and retest confirmation at 648.75 support region towards 638.25 as Take Profit - 1.
WTI Futures - Front Month (Analysis 51-3)
Analysis: Current downtrend momentum is slowing and can potentially trade back up. We will look for long opportunity if price manage to break above the 76.96 resistance region.
Long opportunity: Break and retest confirmation at 76.96 towards 82.56 as Take Profit - 1 level.
Cheers to all our member who managed to pack some profits this trading week.
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