SP 500 E-mini Future
Today had a very different correlative feel as the DX ZB ES and CL contracts all ended higher despite a flurry of misleading headlines out of the EU in reference to Cyprus issue(s).
When looking at the 5 min chart above, @ 6:55am ET the ES pinched below the RED average into 1547.75 sweeping the sell stops before the 1550 was converted to support ahead of the 8 am ET #’s which saw the ZB tick down and the ES remain firm over 83.
|headline from early Tuesday via TPF insider|
This where the disconnect started, ES rallied from 1550 support into 1559 where it currently resides despite the 30 year retracing from 143 into 143’24.
A 24 tick move in about 2 hours and the ES did not flinch, this really threw off the twitter crowd as well as the algo school of fish.
1559.75 remains resistance with 1660.50 being a pinch target over the metric.. 1555 is support.
My take is wait for the break up or down to take a trade. This is same idea as this morning, wait for the break up over 1550 or break under 1545. We got the break over 1550 so you take the long and let it ride.. it paid you 8 handles without pushing back below 1550.
FX & T-Complex
|5 min DX.. arrows will dictate|
Echoing above, the ZB remained very firm following the break out up over the 5 min downtrend @ 143’08 precisely @ 10 am ET. The break can be seen on the right with the white oval above the pinch.
That being said… one can argue bonds had already broken out before the headline hit
“EUROPEAN PARLIAMENT TO PUSH FOR DEPOSITORS WITH ABOVE 100,000 EUROS TO FACE BAIL-IN UNDER NEW BANK RESOLUTION LAW” @ 8:45 am CT ..
Me thinks it was 100% technical and perhaps the large desks saw this break out and decided to slap that headline out there to further pump their position.. genius is you ask me.. it worked.
|5 min 6E. simple channel like DX.|
Currently ZB resistance remains at 143’24 to watch for buy stops over and support to watch for sell stops below 143’13 with support under @ 143’02 before 143 is tested..
As for the DXit sits quietly at 83.045 with support @ 83 to watch for a sell stops under into 82.90. The entire trade is hinged on if 6E will break over 1.29 to retrace perhaps begin to retrace this fairly substantial drop the past 2 months.
|15m in ZB . not pinch @ 9 am ET|
If 6E fails 1.285 then 1.2836 4 month lows come into play, if they fail the DX will be into new weekly highs over 83.20.
What does this mean for equities? Based on today’s action, nothing. But the rubberband cannot stay stretched for long before it breaks violently or naps back into its natural state…
Nasdaq 100 Mini Future
|5 min NQ|
Nasdaq.. nothing to see here.. same levels as this morning..
Apple again faded her pre-market gains and but closed over 460. Tomorrow is another day.
|15 min CL (click for larger)|
Big move here … despite those so sure yesterday’s pop in CL was due to the WTI/Brent crack spread unwinding; CL moved higher by 1.75% to make a new two month high of 96.45 after breaking over late Monday night.
Our private twitter feed, the @TFP_insider; put out a trade idea to place a buy stop @ 94.86 to catch the break up into 95 where we had a sell limit already place, the trade worked beautifully.
Though we did not expect the move over 96 given the overnight resilience of the DX over 83.
THAT being said.. the plan for CL is a break over 96.50 means 97 and a break under 96 means a sharp drop into 95.50 break out/level of much volume accumulation on long and short side during the regular session today.