Futures and FX Technical Analysis

FX Market as of 9:00 GMT (5:00 AM EST)

EUR/JPY (Euro vs Japanese Yen)

- Euro bulls continued to gain ground as cross tested offers around 156.79, a level marked by the 38.2 Fib of the 169.97-147.03 Japanese Yen rally. As price action remains in favor of Euro longs, a further move to the upside will most likely see the cross head higher and test Japanese yen defenses around 158.00 figure, a level defended by the Apr 14 and May 9 spike lows and 50.0 Fib of the Aug-Sept Japanese Yen rally. A sustained momentum to the upside will most likely see EUR/JPY targeting offers around psychologically important 160.00 handle, a level marked by the Aug 26 spike low.

GBP/JPY (British Pound vs Japanese Yen)

- Sterling bulls remained in charge of the price action as cross managed to recover more than 1300 pips after the sharp selloff that established multiyear lows. As cable longs continue to push the cross higher and test the offers around psychologically important 200.00 handle, a level defended by the 50.0 Fib of the 215.88-184.53 Japanese Yen rally, a further move to the upside will most likely see GBP/JPY target 202.00 figure, a level marked by the Aug 21 spike low. A sustained momentum to the upside will most likely see the cross head higher and target offers around 203.90, a level established by the 61.8 Fib of the Jul-Sep Japanese Yen rally.

Equities

S&P 500 December Emini Futures Contract (EZ U8)

- Emini futures contract continued to tumble as volatility remained around multi-year highs as both sides battled for supremacy. As contract once again reverses direction and heads above 1200 figure, a level defended by the 23.6 Fib of the 1443-1136 S&P selloff, a further move to the upside will most likely see the Emini bulls aim for the offers around 1250, a level marked by the 38.2 Fib of the May-July equity selloff. A further move to the upside will most likely see the contract head higher and target the psychologically important 1300 handle, a level defended by the 50.0 Fib of the 1443-1136 S&P selloff.

Interest Rates

Eurodollar June 09 Futures Contract (GE M9)

- Eurodollar futures continued to tick lower as market continued to price higher cost of credit. As futures contract moves lower and targets the bids around 96.58, a level defended by the 38.2Fib of the 95.30-97.38 Eurodollar rally, a further move to the downside will most likely see Eurodollar bears target bids around psychologically important 96.50 figure, with further support seen around 96.34, a level marked by the 50.0 Fib of the 95.30-97.38 Eurodollar rally.

NYMEX/COMEX Futures

Crude Oil November Futures Contract (CL X8)

- Crude oil futures managed to test the offers around the psychologically important 110.00 handle, but failed to maintain momentum and once again tumbled toward 105.00. As both sides remain in a stalemate, a move by the oil bears will most likely see the overall bear trend resume its course and see crude futures once again target bids around the psychologically important 100.00 handle. In case oil bulls exhibit more short-term strength and push the contract higher, a move to the upside will most likely encounter resistance around 112.50, a level defended by the 38.2 Fib of the 148.47-90.42 oil selloff and Aug consolidation lows

Natural Gas November Futures Contract (NG X8)

- Natural gas futures remained locked in a tight range with neither side managing to gain an upper hand. In case bears gain an upper hand and push the contract lower, a further move to the downside will most likely see the contract break below 7.500 figure and target recent lows around psychologically important 7.000 handle. A sustained break to the downside will most likely see the contract head lower and target the bids around 6.600, a level defended by the Oct 2007 consolidation lows, with further support seen below psychologically important 6.000 handle at 5.720, a Sep 2007 contract low.

Gold December Futures Contract (GC Z8)

- Gold futures continued to trade within a large trading range as upside momentum kept failing around psychologically important 900 handle. In case gold bulls manage to get control of the price action, a further move to the upside will most likely see the contract head above the psychologically important 900 handle and target offers around 926, a level marked by the Sept 18 spike high. If gold bears take over the direction of the price action and push the prices lower, a further move to the downside will most likely see the contract head lower and target the bids around 840 figure, a level defended by the 38.2 Fib of the 740-923 bull swing. A further move to the downside will most likely see the metal retreat further and test defenses around 810 figure, a level defended by the 61.8 Fib of the 740-923 bull swing

CBOT Grain Futures

Corn December Futures contract (C Z8)

- Corn futures remained in a consolidation range marked by a large triangle that dominated the price action since August. In case bears regain control, a move to the downside will most likely see the contract head lower and target the bids around the psychologically important 5.000 handle, a level defended by the March 24 and Aug 12 lows. A sustained momentum to the downside will most likely see the contract encounter support around 4.840, a level marked by the Jan 24 low, with further support seen around 4.661, a level defended by the 78.4 Fib of the 3.754-7.992 Corn rally. A move above 5.800 figure, a level defended by the Sep 15 high, will most likely see corn bull target offers around 6.200, a level defended by the 38.2 Fib of the 7.992-5.044 Corn selloff and double top marked by the July 30 and Aug 25 highs.

Wheat December Futures Contract (W Z8)

- Wheat bulls managed to break the recent stalemate and pushed the contract toward the 7.500 figure. A further move to the upside will most likely see the contract encounter strong resistance around 7.7500 figure, a level defended by the May and Aug lows. A successful breakout to the upside will most likely see the contract head higher and test the offers around the psychologically important 8.000 handle, with further resistance seen around 8.250, a level defended by the 23.6 Fib of the 12.842-6.862 Wheat selloff.

Soybean November Futures Contract (S X8)

- Soybean futures failed to gain downside momentum as price action stalled around psychologically important 11.000 handle, despite the break of the large Head and Shoulders pattern. As soybean bulls push the contract higher and test the offers around 12.262, a level marked by the 23.6 Fib of the 16.366-10.994 Soybean selloff. A further break to the upside will most likely see the traders aim for the offers around 13.000 handle, a level defended by the 38.2 Fib of the July- Sept Soybean selloff, thus seeing contract break above the upper boundary of the downward sloping channel that dominated price action since July.

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