TFP morning letter for January 23, 2013
|5 min ES|
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Today’s focus will be on the debt ceiling vote which is expected to pass and will raise the debt ceiling (kick the can) enough to fund the government for three months. I believe the the markets have priced this raise in which is why the S&P has maintained its current levels.
|30 min SPY|
Looking forward into today the S&P will become weaker under 1486 which means a teste of 1484.50 would not be out of the question off the open, under 1484.50 means we are back in yesterday’s 1475-1484.50 channel. Over 91.50 = a run for the roses into 98’s or 1500. SPX 1493 is the resistance to watch
Meaning once the price drops into this channel as highlighted above the price will likely hunt for support around 1483 before faling to 80-75. That being said watch the SPY @ 148.78 support and over 149.50 resistance.
Bonds are once again bid with the 30 year future up 0.195 to 146’09 with 146’17 break out resistance from 1/16. If bonds keep rising throughout the session, equity indexes will have headwind until the flow stops. Today will be the 3rd session of bond gains out of the last 4 sessions. If bonds continue to push into the debt ceiling vote 1484.50-80 will come up quick. Downside is a greater risk than upside in my opinion today.
When looking at commodities overnight they were fairly well behaved with crude oil futures up 0.16% to 96.82 with the high to watch for buy stops over @ 96.92. Gold futures 40 cents to 1693.60 after traded below 1691 briefly. 1700 still remains a target if gold can take out yesterday’s highs of 1695.90. Below 1690 = 1686.
|Copper 15 min|
Nat gas futures are soft again after coming up off yesterday’s lows under 3.53 to 3.60, currently NG is trading down 0.79% to 3.53 under .53 = a test of yesterdays’ low below 3.50 = 3.462. Copper futures are looking to break out over 3.712 with a 3.725 target if the 1/10 high fo 3.718 is taken out
After the close Tuesday Google as well as IBM reported better than expected results which send shares of IBM to 205 and google to 735, shares of AAPL traded into 509 this am but have since fallen back into 506. Nasdaq futures traded 2758 yesterday thus today’s upside level for break out on a trade over is 2758 with a 2760 target.
Watch google over the 740 level for a move into last week’s highs of 745, under 730 could mean 720 quick. IBM shares should get interesting into 210 over the high of 205 under 200 means 196.
Apple reports after the bell which is expected to report a decline in profits to $3.41 & 3.48 a share. Me thinks if apple blows out we see 520+ a failure .. not bad but back to under 490. Best trade is to stay away until the dust settles if you are uncomfortable.