By Fast Brokers – The S&P futures are continuing their fluctuation above the psychological 1150 level as investors prop up the risk trade in the wake of an EU agreement concerning future financial assistance for Greece. The FX markets saw solid pops in the EUR/USD, Cable and Aussie as investors felt comfortable dipping into the risk trade amid oversold conditions. However, these major Dollar pairs have met some solid technical barriers as they pursue their respective recoveries. Hence, it seems the risk trade will need more confirmations, likely in the form of economic data, to knock the Dollar out of its downtrend and send the risk trade higher. Although the data wire is quiet today, the U.S. will release CB Consumer Confidence following UK Final GDP and Nationwide HPI. Hence, activity could pick up tomorrow as we head into Wednesday’s highly anticipated ADP Non-Farm Payrolls report. This week’s focus will likely center on U.S. employment. If U.S. employment doesn’t improve as quickly as anticipated, investors could head back towards the Dollar for safety and drag U.S. equities lower. On the other hand, weak employment data could also yield speculation that the Fed will need to keep liquidity loose, a positive for equities and the S&P futures. On the flipside, strong U.S. employment data may help seal confidence in the economic recovery. While this could prove to be a positive for U.S. equities, should employment improve too quickly this could lead to speculation that the Fed will tighten sooner than anticipated, a negative for U.S. equities. Regardless, it will be interesting to see how the S&P futures react to this week’s data for the movements could prove to be counterintuitive to the usual relationship between macro data and equities. Meanwhile, it will be interesting to see if the S&P futures can hold above their psychological 1150 level while maintaining their upward momentum.
Technically speaking, the S&P futures face topside technical barriers in the form of 3/25 highs and the psychological 1075 level. Additionally, the psychological 1200 level could serve as a solid technical barrier should it be tested. As for the downside, the S&P futures have multiple uptrend lines serving as technical cushions along with 3/24 and 3/22 lows. Additionally, the psychological 1150 level could serve as a solid technical cushion should it be tested.
Price: 1165.50
Resistances: 1168.73, 1170.46, 1172.19, 1174.72, 1176.45
Supports: 1163.39, 1162.17, 1160.87, 1158.99, 1157.48
Psychological: 2010 highs, 1150, 1175, 1200
(click chart to enlarge)
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