Sorry blog readers,

this blog machine is stuck on this old dog June date, technology  gota luv it! 

rgds pete

EarlyBird Report – 29 June

Dow Jones Index +1.21% 12,188
US Dollar Index -0.31% 75.04
US August Gold (Globex) 1500
WTI Oil (Globex)   92.80
Copper (Globex) 410
US BHP +2.22% 91.26
Base Metals: Positive
AUDUSD 1.0540
EURUSD 1.4370
SPI 4520

US News Wire
U.S. The energy and consumer-discretionary sectors led U.S. stocks higher following reports of progress in European leaders' Greek-debt negotiations.

The Dow Jones Industrial Average rose 120 points, or 1%, to 12164 in afternoon trade, with Caterpillar rising 3% and Home Depot adding 2.4%. The Standard & Poor's 500-stock index gained 13 points, or 1%, to 1293. The technology-oriented Nasdaq Composite rose 32 points, or 1.1%, to 2720.

Investors bet on a better turn in the Greek-debt crisis after France's plan for helping to resolve the country's debt problems got a favourable response from German banking associations. The French plan, which aims to orchestrate the orderly participation of private creditors, would have banks reinvest half the proceeds from maturing bonds into 30-year bonds. Stocks have risen and fallen for weeks on news about Greece.

Commodities

US August Gold Futures 1500
No real change here, we expected a corrective pattern at 1500 and its still unfolding, we have changed the Elliott labelling, to a Wave 4 at 1500, this would see a eventually see a move to SG2 1472 and then a retest back to 1500.
Wave fours as you know can be tricky they can be the most complicated, so wait for a clear price resistance to occur at this MediumLevel 1500 before shorting, I say this because the Dow is above 12,000.
Silver is doing much the same at the Fibo 34 level as mentioned before

Oil WTI (Globex Futures) 92.90
The bounce in Oil has finally started, ignited be the rise in stock, this is also seen in base metals. 91 I 92 I 93 are MinorGroup1 (MG1) if the price can develop support on top of MG1/ 93 then it can go to 95 (mTL5) MinorLevel.
The Elliott count is seeing this as a corrective rally, on our charts as a wave four, but as a trader, trade the levels, it’s how you can control the trade.

Base Metals

US Spot Prices (24HR in l/b)
US Copper:           Last: 4.09+
US Nickel:             Last: 10.22+
US Zinc:                Last: 1.01+
US Aluminium       Last: 1.11+

Copper (Globex Futures) 407
You know I like the Copper market, as it firmly integrated into many aspects of life and therefor a good guide stick, without it trending it’s hard to confirm other market trends, such as the AUDUSD going down when Copper is above the MediumLevel ML4, and the obvious local Materials sector which includes US BHP at 90 (ML9) Being above ML4 /400 the market is supported and sure it’s a long way off being support above 430 top of group1 but for now being above 400 is a stabiliser and why we locked in 50% in our ASX BHP short trade at 42.

Forex

US Dollar Futures (c) DXY 76.10
The short term for the Dollar and the Euro have a few interpretations, so it would be far better to use the price and the 144 for the Euro as support and resistance and the 75 for the DXY, we now have to give them time to play out at these levels and pick up the trade from here long or short based off S/R
The DXY would need to get back above 7572 as a sign of further strength.

EURUSD

TradingLevels: Back at 144, thee is not a lot to say here, as it will simply fail here or find support, so patience is require
Trade Strategy: no position trading just trading the sublevels, which can be used to glean a larger position.
The price nearly reached 144 and reacted, it’s looking for support… if it traded back above SG2 14372 then trade it to 144

AUDUSD 

TradingLevels: Above the level 105 and the bias in positive, the structure of the move up can be corrective or impulse, this aspect requires more time to develop, however the actual internal trends and corrections are expanding in size, this is momentum from volume interest
Elliott Wave: The last two trends down (see chart today) have equality, this is more of a corrective element, so upside potential looms. The 105 is the critical price for support for this to occur.
Trade Strategy: Trade the sublevels

Indices

Dow Jones Futures CFD 12,180

TradingLevels:
The price above our 12000 pivot and above the 12100 flips the bias to the upside, which would be in line with the Shanghai Markets rally.
Elliott Wave: The structure of the move up is currently corrective (three waves) but this can develop into a positive impulse (five waves) time is required.
Trade Strategy: Every 100 points is important to the Dow so the 12,200 will meet resistance, it’s also an old high and can fail from this point, we have to expect a reaction at least from here or a sideway correction across it

S&P500 CFDs 1,280

TradingLevels: Retesting 1300 expect a reaction.  While it’s under this level we have to treat it as corrective. Let’s wait to see if the market finds support or resistance here before over reacting
Elliott Wave: While the price is above the 1272 its short term positive but now its close to 1300 we just have to allow the corrective structure play out
Trade Strategy: wait

FTSE 100 Futures 5750

TradingLevels: Resistance 5800 Support 5772 SG2 requires retesting to confirm
Elliott Wave: The short term trend yesterday was bullish and now the larger trend is bullish because it made a new high, it still has to work through the 5800 mTL8, so expect a ABC correction pattern across it. The mTL8 is a profit taking number so it can fail here, so there is a lot of important on the pattern created at 5800
Trade Strategy:  observe the corrective or sell off pattern at 5800

SPI Futures 4471 

TradingLevels: Above 4500 is positive and a rally can emerge from here. The Copper market and the Shanghai market we talked about on Monday were the stabilising factors, and yesterday the Dow being above 12000 is the other. The Shanghai is the safe bet to say it will rise further, whereas the Dow is uncertain every 100 points is a test. And while the SP500 has 1300 as resistance there is risk.
Trade Strategy: long above 4500 stops under

Summary

Our short term thinking yesterday was that the rallies were just that rallies and they still can be for the US Indices and we were expecting Oil and Gold to rally, we see this as still the case for these markets. If the SP500 found a robust support on top of 1300 then a more positive bias would form.

Where the strength does come from in my view is Copper, it was the only market not going down and the first sign of strength came from the Shanghai (should correct at 2800) and Shenzhen mentioned on Monday as it have the first five waves up off its lows.
The other was our local SPI as we also talked Monday and Tuesday about its first five waves up and how yesterday the SPI maintain its higher low whereas the ASX200 created the new low, these were the first signs of strength, the other was US BHP having five wave down from 100 to just below 90, which now is completed by the move up last night

Another confirming aspect is the AUD being back above 105, but what makes this interesting as a positive is that the last two trends down were equal this is a corrective element not an impulse element, this also lines up with copper

The rally in the SP500 can be a wave 4, but if it finds support above 1300 then we can flip the bias to the upside and this would be fine with the Euro count, but as the SP500 wrestles with 1300 the Euro will dance with the Fibo 144.

So what to do with our trades; the first rule of trading is to protect the asset. Opinions can get us into loss with having rules, trade rules and risk management rules, it’s our job to track and trade the markets not hold on our opinions, if the direction changes three times I would rather go with that, take the small losses and be on the right side of the market if it going to trend.
That said, many of the short trades we have are loaded with selling pressure so they are fine, we don’t know if the SP500 will fail at 1300 or that the ASX200 will find support on 4500, it’s still early days. It doesn’t hurt to lock in some profits on some of the short trades.

At the end of the day the 4500 is the line in the sand and being above or below this swings the bias of the market, we know the markets are over sold, but we don’t know the extended of any rally that does take place. But we have to make some effort to move with the bias.

Trading Quote
"To change emotional responses takes constant self-awareness, time, fundamental personal honesty, and the willingness to suffer the pain of letting something go that we feel is dear to us."

Traders, we would like to inform you that content (Charts) published on FOREX GOLD SP500 OIL  will not be updated from Friday July 1st till July 15th 2011. The EarlyBird will do its best to cover these until the 15^th July.

Today's Financial Events
Time     Currency   Detail     Forecast    Previous
  
9:50am  JPY     Prelim Industrial Production m/m    5.6% 1.6%  
All Day  EUR     Italian Bank Holiday      
6:30pm  GBP     Net Lending to Individuals m/m    1.2B 1.2B  
6:30pm  GBP     Index of Services 3m/3m    0.7% 0.9%  
6:30pm  GBP     M4 Money Supply m/m    0.3% 0.1%  
6:30pm  GBP     Mortgage Approvals    46K 45K  
7:30pm  CHF     KOF Economic Barometer    2.23 2.30  
9:00pm  CAD     Core CPI m/m    0.2% 0.2%  
9:00pm  CAD     CPI m/m    0.3% 0.3%  
12:00am  USD     Pending Home Sales m/m    1.3% -11.6%  
12:30am  USD     Crude Oil Inventories     -1.7M  
2:00am  USD     FOMC Member Raskin Speaks

NOTES:
1. Check the Dividend & Reporting section for your stock on this site before trading
2. Prices may change as this report is written while markets are closing/trading
3. Always think things out for yourself, we are only here to bounce ideas around.

Good Morning & Good Luck!

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