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New home sales plummet, stocks under pressure
The Federal Reserve announced that they will continue to leave interest rates at exceptionally low levels for an extended period of time. The decision itself was a non-event but investors were a bit disappointed in the Fed's downgrade on its economic outlook.
The Fed still believes that the recovery will stay intact but their tone was a bit less optimistic. Specifically, they stated that "financial conditions have become less supportive of economic growth...largely reflecting developments abroad." A reminder that European problems could bleed into the U.S. didn't sit well with the financial markets.
Also putting a negative tone on trade was news of a 33% plunge in new home sales. A government report released this morning claims that the seasonally adjusted pace of sales for the most recent month was 300,000. This was a horrible showing given already meager estimates of 410,000.
In yesterday's newsletters we stated that:
"The bears seem to have an edge here...at least until we trade in the low 1080's in the September S&P."
The markets have reached our downside objectives in the major indices, although The NASDAQ didn't quite reach 1850 as we had hoped for. From here we are neutral and would like to see the price action tomorrow before forming an opinion. However, we see potential for a move higher from here...let's see what happens.
* 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 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 can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.
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.DeCarleyTrading.com
http://www.ATradersFirstBookonCommodities.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.
