The Rooster Call: Euro Higher on Perceived Economic Conditions

Hit the Mark Trading’s Brief Review of Overnight Market Action Setting the Tone for the Trading Day

Good morning, traders! European equity index futures are higher as well as Euro incrementally higher. There’s lots of talk about a Novartis / GSK deal worth $7.1 billion. When big deals are announced traders get excited as a signal economic conditions are improving. We also have a corporate raider taking a run at Allergan. These two events will likely contribute to a positive mood for pharmaceuticals and biotechnology today.

The strongest data point worth watching today, in my opinion is existing home sales. As mentioned yesterday, tonight’s Chinese PMI should weigh on the markets Wednesday. We also have Euro zone and USA PMI reported on Wednesday. The potential for continued thrust higher for equity index futures exists as long as consensus is met or exceeded.

Yesterday’s trading showed the lowest volume of the year according to CNBC. Let’s attribute this to the Monday after a three-day weekend effect. Continued low volume is not a good sign.

Today’s Reports and FED Activity

10:00AM ET – Existing Home Sales
10:00AM ET – Richmond FED Manufacturing Index
Tonight — 9:45PM ET – China PMI Flash Manufacturing Index

Overnight/Pre-Market

  • US dollar hit’s a bench mark and trades lower today. Lower US dollar helps US stocks and US dollar denominated commodities.
  • Euro in a wedge showing lack of conviction.
  • Brent crude backing down off resistance.
  • USA crude lower with Brent.
  • Corn tests a bench mark.
  • Beans are quiet.
  • Wheat quiet.
  • Gold flat.
  • Copper flat. This one will move on Chinese PMI.
  • Cotton higher.
  • Coffee tests resistance again.
  • Sugar quiet.
  • Cocoa locked in side way channel.
  • Bonds are flat.
  • ES/NQ/TF/YM are incrementally higher awaiting USA open.

Day Trader Bench Marks

Intraday ES Floor Pivots – Using 24 hour electronic market hours 1800-1715 ET.

R3: 1876.75
R2: 1871.25
R1: 1867.75

Main floor pivot: 1862.25

S1: 1858.75
S2: 1853.25
S3: 1849.75

Intraday Euro Floor Pivot – Using 24 hour electronic market hours 1800-1700 ET.

R3: 1.3862
R2: 1.3846
R1: 1.3818

Main floor pivot: 1.3802

S1: 1.3774
S2: 1.3758
S3: 1.3730

Think About This!

Yesterday, a client mentioned working on her trading mind with assistance from Dr. Andrew Menaker. So yesterday, I listened to one of his lectures and was impressed with his approach. Here is the link if you are interested: http://traderkingdom.com/experts/1656-dr-andrew-menaker-

Why would you be interested? Consider trading is 85% mental. That’s a pretty good reason.

Have a great trading day!

To learn more from Martin, visit HitTheMarkTrading.com to join his mailing list and receive blog updates.