June 26th, 2009
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Consumers are confident, but not spending
Volume and excitement were on the light side ahead of the weekend, leaving me with very little to write about.
The University of Michigan reported a slightly higher reading in its consumer confidence reading but consumer income and spending data suggests that Americans are still tight fisted. As a result, investors found little incentive to continue yesterday's rally.
Personal income and spending numbers point toward the highest savings rates in years. I doubt that anybody was surprised to hear that the savings rate had increased. Consumers were overleveraged and it will take years for things to unwind. However, it is clear that the lack of velocity of money will act as a plow to the recovery. "The consumer is not going to completely hibernate although the consumer is not going to be the same force" as was the case when "coming out of the previous recession" noted Henry Smith, chief investment officer of Haverford Trust Co. in Philly. He added, "Ultimately, this expansion will be characterized as a below average, slower expansion."
The markets made very little progress in either direction, therefore yesterday's projections are still valid:
In our last newsletter we mentioned that the S&P can bounce as high as 920 without compromising the bears. Today's high of 917ish was significant, and while a retest of the highs and maybe even 921 are possible in Friday's session we feel as though failure to close above these levels will lead to another wave of selling going into next week.
We see strong resistance in the Russell near 507 and 8,544 in the Dow. The NASDAQ remains the strongest of the major indices, but we see resistance near 1482.
Sorry so short, enjoy your weekend!!
* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.
**Seasonality is already be factored into current prices, any references to such does not indicate future market action.
Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations are based the full sized S&P unless otherwise noted.
S&P 500 Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
Russell Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.
NASDAQ Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
1-866-790-TRADE
Local : 702-947-0701
http://www.carleygarnertrading.com/
http://www.decarleytrading.com/
*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.
There is substantial risk of loss in trading futures and options.
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
