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Providio’s Daily Futures Market Comment for 01/10/12

10Jan The possibility of Chinese intervening to spur economic growth and Fitch’s less negative outlook on Europe underpinned yesterday’s rally in most of the physical markets we track. However, they are lagging our Overbot Equity sector while the EuroFX is looking lonely, extending its stay on our Oversold list. This week’s light US economic calendar turns attention to GOP primaries and any news coming out of Europe. Currencies:­­­­ 10Jan What started out as a stronger day across most of the majors faded as the session wore on. The “Commodity Currencies” benefiting most from speculation that Chinese intervention may help spur demand. Volumes are inching their way back to pre-holiday levels. With the exception of the weaker tone in the Euro, we note the wide consolidation ranges that have been in place since the summer, but these patterns are running out of time. If there is a resolution that emerges on higher Volume, in keeping with traditional technical analysis, the moves could be enormous. Below average Volatility may be telling us that an “uncoiling spring” may be in the offing… Aussie: 10Jan Testing the pivot/fulcrum nature of the March 200-day Moving Average at 103.55, but still in a wide, symmetrical triangle consolidation pattern in place since August that is bound by 9900-10420. All of our technicals are pointing higher and the market is not yet Overbot. This currency, along with the Canadian, has been highly correlated to the physical commodities’ action. Seasonal Snapshot: Divergence between all three patterns until mid January: 30yr down, 15 yr up and the 5yr consolidates. After rallying until 22Jan, the 30yr then joins the 5&15 yr in a move down until the end of the month. British: 10Jan Respecting rising trend line support that forms the lower end of our symmetrical triangle that has been in place since August. With most tracked US denominated FX contracts lower on the day after the US Jobless number, it seems increasing likely that the Sterling is destined to test support in the 1.5350 area. Most of our signals indicate a broadening weakness with some residual strength stemming from safe-haven to the Euro’s issues. Additionally, the 200-day Moving Average is falling and the market is still well below that level. Seasonal Snapshot: The 15&30yr move down until 10Jan followed by choppy consolidation in all three patterns until Feb. Canadian 10Jan Today’s rally tests the upper end (98.50) of the symmetrical triangle formation that has been in place since August. There has been high correlation to the Aussie$ and physical markets. The 200-day moving average lies well above at 100.55 Seasonal Snapshot: The 5yr pattern declines precipitously from 08-22Jan. The 5&15yr patterns arrive late to the party (14Jan), but stay longer (28Jan). Dollar Index: 10Jan Watch the EuroFX, as it seems to be trumping the other major currencies in underpinning the Dollar Index since November. The resulting rising channel is bound by 80.30-83.00. The market is leaning Overbot, but a test of the upper boundary of the channel may be in the offing. 80.00 will continue as strong support, with a new, higher support levels at the obvious 81.00 and also at about 81.30. Seasonal Snapshot: All three patterns rise until 20Jan. On 24Jan, the 15yr breaks away from the ensuing consolidation and rallies again until the end of the month. Euro-FX: 10Jan Watch the round pennies on either side of the market for support and resistance. The falling channel in place since late October that is bound by 125.70-130.25. The lower end coincides with the August 2010 low. Oversold somewhat, but not showing signs of turning. Seasonal Snapshot: A decidedly weak tone until the end of Feb. For more: http://commoditytr ading.yuku.com/top ic/717/master/1/#. Tw0qt4HAAhA  (Jan 10, 2012 | post #1)

Day Trading

Providio’s Futures Market Commentary for 12/29/2011

Gold: (28Dec) Today’s weakness probed below our noted support level at the 15Dec low at 1562.5, but is trying to hold on as of this writing. More weakness targets the 26Sep low at 1543. Our Trend and Momentum indicators are still falling. Today’s Volume seems to be stronger than it has been recently, but is still muted due to the holiday market conditions. This clouds the resolution of both our previously noted bear flag formation and our symmetrical triangle pattern. That said, both patterns are starting to play out: the first projects a move down to 1390; the second down to 1325. By our standards, the market is Oversold, but with a current reading of 26 vs. the 13 measurement we had the last time it was at these levels may signal more downside is on the way. The 200-day moving average at 1621.8 is still rising and should cap any rallies. Seasonal Snapshot: General strength through the end of the year in the 5, 15 & 30yr patterns. The 30yr whipsaws down then up during the first two weeks of January. Copper: (28Dec) More weakness. The pattern of lower highs and higher lows since late September also keeps the market in a symmetrical triangle formation, currently bound by 325.00 and 345.00. Our technicals point to lower action and the 200-day Moving Average is falling. Seasonal Snapshot: All three patterns consolidate until year-end. The 15yr turns higher from 04Jan through 13Jan while both the 5 & 30yr consolidate until the end of Jan. Softs: (29Dec) Largely a position squaring consolidation day. Low Volume. Cocoa: (20Dec) Early action bounced March Cocoa off the important 2075 support. With all the technicals now having made the turn to a more positive bias, this market has room to run as its still coming off being the most Oversold Commodity we’ve ever seen using our measurements. We would have liked to seen more Volume, but the impending holidays and year-end squaring may be sucking the life out of this markets liquidity. Seasonal Snapshot: The short-term 5&15 yr seasonal pattern continues its march higher until early 2013. The 30yr has entered a wide, volatile consolidation range that lasts until mid January. Coffee: (20Dec) Coffee extended yesterday’s move but Volume barely budged. Some waning of interest is to be expected given the coming holidays. Additionally, even with the nice 2-day rally, the market still has to get through 225.00 just to get into the chart structure. This is the only Volatility on the higher than Standard Deviation list. Looks like short covering to us. Seasonal Snapshot: The 5yr is more pronounced, but all three patterns have a positive bias until 19Dec when choppy consolidation takes over at the beginning of Feb. Cotton: (20Dec) Easily the most disappointing of the tracked Softs. Failure is the name of this chart. Failure to make new highs and failure to settle higher. Of positive note, March didn’t make lower lows, so that’s supportive. Primary indicators are still negative. 200-day Moving Average still clearly falling. Seasonal Snapshot: Moderate upward bias marches higher until year-end. Sugar: (20Dec) A reasonably heavy day of Volume validate the move higher in March. Most of the best positive action and the biggest volume surge occurred immediately following the US Housing Starts data release. A close look at the March chart action has the 2300 level showing as a significant support and resistance level; largely supportive at this point. If this level fails, materially lower levels are to be expected. The 200-day moving average (26.60) has been moving decidedly lower for a while and should cap any rallies. Seasonal Snapshot: On 09Dec, the 5yr pattern kicked off the march higher in all three patterns until year end. Disclaimer: There is risk in trading futures and options. One's financial suitability should be considered carefully before placing any trades. Past performance is not indicative of future results.  (Jan 2, 2012 | post #3)

Day Trading

Providio’s Futures Market Commentary for 12/29/2011

NatGas: (20Dec) Modestly cooler weather has usage likely rising but not a pace that will chew through the record storage. Secondaries have gone positive but Primaries are still negative in bias. Without a sustained cold spell in the Midwest and Northeast, this market should remain largely in a bearish pattern. Along with Heating Oil, the lack of real cold weather has the heating fuels under pressure and Oversold. Seasonal Snapshot: The 15 & 30yr patterns are pointed strongly to the downside through the end of the year. The 5yr is sideways with a mild downward bias. Equities: (29Dec) Higher action off of better US data. Modest lower Volume rally with the market not setting any new levels. Stay away until after the New Year. Seasonal Snapshot: The SP & Dow’s 15&30yr patterns are in an uptrend for the rest of the year. The NASDAQ’s upward pattern has been in place since the middle of July and continues until the end of the year. Grains: (29Dec) Modest inside days on our 3 tracked markets. No new levels and position squaring at work. Corn: (27Dec) Not to be left behind, Corn joined the rally in the sector on the back of Beans and poor South American weather. The March contract’s break out above 620 reversed the falling trend. Pay attention to the extreme Overbot conditions and the gap down to 621 in the Mar contract that was left on Tuesday morning’s reopen. Seasonal Snapshot: The 5yr pattern leads the choppy 15&30yr patterns gently higher until the end of February. Soybeans: (27Dec) Today’s rally (on threatening South American weather) saw the strongest Volume in two weeks. Beans have led the strength in all three markets we track. What looked like a rounding top, a bearish pattern, last week, has now sustained its break out above the highs near 1160 in the Jan contract, right into a congestion level bound by 1170-1230. Sustained strength targets the 14Oct high at 1283. Pay attention to the extreme Overbot conditions and the gap down to 1167 in the Jan contract that was left on Tuesday morning’s reopen. The 200-day Moving average is still falling. Seasonal Snapshot: Consolidation in the 30yr pattern and more choppy in the 5&15 yr ends in mid Dec when all three take a more positive tone through the end of the year. Wheat: (27Dec) There is no gap left on Tuesday’s reopen, but given the recent high correlation, one wonders how a selloff in the remainder of the sector would affect Wheat. Mar is revisiting the congestion area from 3 weeks ago. The 200-day Moving Average has been falling for the past 3 months. Seasonal Snapshot: The 5, 15& 30 year patterns are all generally trending positive into year end. Interest Rates: (27Dec) The “deepening” debt crisis in Europe is driving scared money into the US Treasuries. Plain and simple. Keeping the levels from yesterday even though there was no weakness today: Rising trend line support on more weakness: Mar Bonds 142-00 Mar 10yr 130-00 Fairly significant support levels remain in place for long-dated instruments Mar Bonds- 140-00 Mar 10-Yr- 129-00 Mar 5-Yr - 122-16 (untracked) Mar Bund- 133.30 Seasonal Snapshot: 5, 15 & 30 yr patterns in long-dated maturities’ US Treasury instruments have a short, mild upward bias, then consolidate until year end. The 2yr has a negative bias until year end, but is much more choppy. Metals: (29Dec) More significant weakness in Gold was mitigated in late position squaring buying. Copper’s strength reflected the improving outlook for the US economy.  (Jan 2, 2012 | post #2)

Day Trading

Providio’s Futures Market Commentary for 12/29/2011

Please see below for updated comments on the Grains and Metals. In particular the Overbot conditions and gaps left to the downside on this morning’s reopenings in Corn and Beans. Currencies: (29Dec) End of year position squaring, improved US economic forecasts, and Iranian threats ion the Persian Gulf has some churn in the FX market among others. Europe’s debt will still be an issue but for today, it’s off center stage. E WARY OF ANY FURTHER EXTERNAL DYNAMICS AS THAT HAS BEEN THE PATTERN WHEN “RISK OFF” BECOMES OVERDONE. Aussie: (29Dec) A close to 3-month symmetrical triangle with no break out in sight. The 200-day moving average at 101. 40, while still rising, has been acting as a ceiling since breaking below decisively on 11/9. Seasonal Snapshot: All three patterns firming until the end of the year. British: (29Dec) Sterling made news lows, and just looks dreadful on the chart. Late position squaring mitigated the day’s losses. The 200-day Moving Average is falling and the market is still well below that level. Seasonal Snapshot: The 5yr is diverting from the 15&30yr: 5yr continues the descent into the end of the year, the 15&30yr move higher. Canadian: (29Dec) Recent action retains its look of a symmetrical Triangle pattern. Look for resistance at about 9850 and support near 96. 40. Neither is likely to be tested until next week. Seasonal Snapshot: All three patterns are weak through the end of the year. Dollar Index: (20Dec) New highs hit earlier on, then positions squaring took the market down a few ticks. Rising Trend is still rising. Look for even more light action until the middle of next year. The 80. 00 level is showing as a significant support area. Without further external actions by authorities, we expected previous pricing dynamics to resume their directional bias, regardless of our current technical tone. Seasonal Snapshot: Choppy consolidation with a downward bias until year end. Euro-FX: (29Dec) After making new lows, the Euro rallied late in the day on position squaring. Despite the late action going higher, the falling longer term trend is still in place. With the 200-day Moving Average and no “bad news” coming out about the European debt issue, the dynamic shifted elsewhere. Volume was quite restrained. That said, watch and tighten risk controls if the Euro continues to break down. Some sort of artificial government dynamic is likely there. Outside of that, resistance should be offered at falling trend line below 1. 3150. Seasonal Snapshot: A more positive bias until the end of the year. Yen: (15Dec) March Yen basically testing a support level at 1. 2825. The general post BOJ intervention consolidations range low is about 1. 2810. For all intents and purposes, the Yen has gone nowhere post intervention. Our technicals are a mixed bag, consistent with a market in sideways action. Though there are fundamental reasons to short the Yen, the technical picture is not yet clear. 12810 shows as strong support. Seasonal Snapshot Consolidation with a downward bias ion all three patterns until year end. Energies: (29Dec) After yesterday’s dire European debt news, the dynamic gave way to US growth prospects and Iranian mischief in the Persian Gulf. More seasonally warm weather in the Midwest and Northeast has NatGas on the run again. Seasonal Snapshot: All three tracked Petro markets’ negative bias has turned positive until year end. To our surprise, the pattern is much more pronounced in RBOB than in its two Petro counterparts. Crude: (20Dec) With better than expected US Housing Starts data and Iranian supply concerns, Feb staged a meaningful rally. Its highs are right at the bottom of a range put in before last week’s plunge. Volume fell. Stay with a negative bias in the absence of any compelling news in either direction. 92. 50 is showing as a support level in Feb. A failure to hold there probably targets the upper 80s. Watch the Euro for a clue as to direction as they have been well correlated of late.  (Jan 2, 2012 | post #1)

Day Trading

Providio's Special Metals Commentary

Gold: 14Dec Gold is testing the 200-day moving average at 1615-1620. Use a tight stop just below that level if you are trying to pick a short-term bottom. Upside risk is the historically Oversold condition. If the market sustains a move below the average, see below for levels. That said, our Momentum measure is now decidedly negative and the market is sustaining the move below the lower end of our symmetrical triangle formation that has been in place since early September, bound between 1705-1750. A continuation of the pattern projects a move to 1325... The previous lows at 1607.3 (20Oct) may offer new support. Upside risk is the historically Oversold conditions, as it is the most Oversold it has been since late September. Falling trend line resistance comes in at 1683 and old support at what was the lower end of the triangle (1705) should now offer new resistance. There is an interesting discussion of “paper” vs. physical gold and the ETF market, where some of this recent pressure may be originating. In our opinion, while this dynamic is pressuring gold in the interim, it would be long term bullish: http://www.zerohed ge.com/news/etf-an d-central-bank-gol d-lent-banks-being -relent-market Seasonal Snapshot: General strength through the end of the year in the 5, 15 & 30yr pattern Copper: 14Dec Still sagging on concerns over any meaningful agreements or pacts in the EuroZone and lack of stimulus here at home. After failing to make a meaningfully higher high above the huge rally two weeks ago. That move broke the March contract out above what appears to be a symmetrical triangle from mid September but the stall-out has now pulled our Momentum negative. Rising trend line support from back to late Sep comes in at 330.00 and the previous low was 321.85. The 50% retracement of the August-September decline, about 20 cents higher at 375.00 offered resistance in late October and the market made an ensuing higher low, which can be constructive. A sustained move through this level targets the (falling) 200-day moving average another 25 cents higher at 400. Seasonal Snapshot: All three patterns consolidate until year-end There is risk in trading futures and options. One's financial suitability should be considered carefully before placing any trades with Providio Trading Consultants, Inc.  (Dec 15, 2011 | post #1)

Ho Chi Minh City, Vietnam

Providio's Daily Technical Market Comment for 12/5/2011

http://commoditytr ading.yuku.com/top ic/694/master/1/  (Dec 6, 2011 | post #2)

Ho Chi Minh City, Vietnam

Providio's Daily Technical Market Comment for 12/5/2011

Today was the day when those “powers that be” announced they are ‘really serious this time’. Over lunch, French President Sarkozy and German Chancellor Merkel called for a new European Union treaty that include automatic sanctions for countries that violate rules to keep government deficits in check. They hope to decide on the changes by March. This is ahead of Thursday’s ECB rate decision and a summit of EU leaders in Brussels. CFTC approved a rule that puts tighter limits on how brokerage firms can use customer funds. As both of these items essentially already have rules and regulations on the books, we wonder if they will receive the same focus on enforcement going forward. Markets reacted in sympathy, boosting the Equities and selected physical markets higher and pressuring the US Dollar and Treasuries. By early afternoon, however, talk that S&P is on the verge of downgrading France, Germany and several other triple-A rated sovereigns set this move back on its heels. Currencies:­­­­ 05Dec With the French and German Euro-zone debt discussions continuing to provide hope, there has been a modest anti-US Dollar rally and subsequent sell-off from their highs. There has largely been sideways action from the extremes caused by last week’s intervention. It seems like the various FX markets are waiting for the next externally driven market dynamic. This week has a relative dearth of data releases, chiefly sentiment/confiden ce indicators. Look for news out of the Euro-zone as the most likely candidate for some sort dynamic producer. However, further news out of Asia could make an impact, too. The uncertainty in the Euro-zone shows up in our European currencies, including the untracked Swiss Franc, all having RSIs close by the indecisive and mid-level 50 level. Aussie: 05Dec Even with the late session weakness, the Aussie remains our strongest currency. It sits right above the still rising 200-day Moving Average. It now appears as if 1.0300, which the Aussie has been unable to stay above for more than a few minutes, is acting as the nearest term resistance. Volume figures point to a consolidation of last week’s gains as other dynamics work their way out. On a recent historical basis, the recent Momentum turns have lasted slightly less than a month. Given that recent history, look for a likely positively biased Aussie though about year-end. This may be subject to a sudden shift if the fundamental dynamic change. Seasonal Snapshot:All three patterns firming until the end of the year. British: 05Dec With thesizable intervention led action now in the rear view mirror, Sterling remains in a consolidation pattern. Which direction it breaks out to is now the question. If it’s positive, it’s likely on a shorter-term pattern basis with a reasonable breakout above 1.570. If it’s negative however, it’s in keeping with the bearish action from late October highs. This targets a lower low than late Nov and possibly the early Oct lows below 1.52. Of note is that our latest shift in Momentum was after a materially shorter period than the previous 2 shifts. Sterling also remains well below the 200-day Moving Average, which is still declining. Seasonal Snapshot: The 5yr is diverting from the 15&30yr: 5yr continues the descent into the end of the year, the 15&30yr move higher. Canadian 05Dec The Loonie participated in the early AM rally to levels close to the initial rally levels from last week’s intervention. Since peaking near 9 AM Central this AM, it fell to test the 9800 support and bounced back into the congestion near the lower end of the post intervention action. The 200-day MA is still declining which is counter to the current daily Momentum Seasonal Snapshot:All three patterns are weak through the end of the year.  (Dec 6, 2011 | post #1)

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Providio's Daily Futures Market Comment for 11/29/11

Currencies:­­­­ 29Nov Rates of Change have reversed, but none have pulled Momentum with them… yet. Volumes have returned to decent levels and Open Interest has actually risen in selected markets. Aussie: 29Nov The wider picture since September shows a pattern of higher highs and higher lows. Recent action keeps within this theme, as the most recent low failed to breach the previous low of 93.02 on 04Oct. This market has been moving very rapidly, so beware of quick overextensions from moves that have gone too far, too fast. This recent rally off the lows may be one of those kinds of moves. Beware of a gap down to 9748 left on the Sunday night opening. That said, resistance should be offered at a variety of levels in relation to the previous fall: * The previous decline paused at some congestion at par on 10Nov which is also near the 38.2% retracement (100.35) of the move. * The 200-day moving average is just above par at 102.02 * A new high would have to take out 26Oct’s at 106.87. Open interest has fallen, but not to a new recent low. Seasonal Snapshot: All three patterns firming until the end of the year. British: 29Nov The previous decline paused at 156.85. Look for this area to offer some resistance. Resistance has also been offered at the 200-day moving average, currently at 160.70. Open interest has been rising on this recent rally and Volume has been decent. Seasonal Snapshot: The 5yr is diverting from the 15&30yr: 5yr continues the descent into the end of the year, the 15&30yr move higher. Canadian 29Nov Still struggling with the 9700 level which served as material support level before the general collapse to the 9500 lows. 9650 is now a support level to watch as another failure to hold likely targets much lower prices. Open interest is consolidating last week’s gains. Seasonal Snapshot: All three patterns are weak through the end of the year. Dollar Index: 29Nov The recent failure to achieve new highs (7987 on 25Nov vs 80.43 high on 04Oct) targets the 200-day moving average at 76.50. Before that, old resistance at 78.60 should also offer new support. Seasonal Snapshot: Choppy consolidation with a downward bias until year end. Euro-FX: 29Nov Despite recent headlines, the Euro is not really participating in this recent reversal of fortune… today was another session of probing higher, then giving away gains by the close. Yesterday resulted in a Doji Candle, indicating indecision and today may see the same. Any hints of a rally have been accompanied by a decline in open interest… the crowd is obviously short. Seasonal Snapshot: A more positive bias until the end of the year. Yen: 29Nov Momentum has gone negative and there is secondary weakness. However, it should be noted the Yen bounced off the post-intervention congestion area. Though there are fundamental reasons to short the Yen, the technical picture is not yet clear. Seasonal Snapshot: Consolidation with a downward bias ion all three patterns until year end. Energies: 29Nov A positive day across the complex, but an ‘inside’ one in the Crude. Expectations for tomorrow’s DOEs show little change in the supply picture. Seasonal Snapshot: All three tracked Petro markets commence a pronounced negative bias at the onset of December until mid month. Crude: 29Nov Crude has been oscillating around the 200-day moving average (97.20), finding support there the last two sessions. Below this level, the Jan contract has been supported at 95.00. Volume has been trending higher on this recent rally, but from much lower levels. Our rising Rate of Change is threatening to pull Momentum higher, signaling a resumption of the month-and-a-half rally. The previous high at 103.37 (17Nov) should offer some resistance. http://commoditytr ading.yuku.com/top ic/688/Providio-s- Daily-Futures-Mark et-Comment-for-11- 29-11  (Nov 29, 2011 | post #1)