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Stock Index Futures Up for Eight Day


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May 14, 2018

STOCK INDEX FUTURES

Stock index futures are higher for an eight consecutive day.

Some of the strength is due to a report that Chinas Foreign Ministry spokesman said China is willing to work with the U.S. for a positive outcome in trade negotiations in talks in Washington from May 15 to 19.

There are no major economic reports scheduled for today.

In the longer term, traders will probably gradually shift their focus of attention more toward corporate earnings and the still overall accommodative global interest rate policies and away from a variety of geopolitical worries, including global trade tensions and now the situation between the U.S. and Iran.

CURRENCY FUTURES

The U.S. dollar is lower and the euro currency is higher for a fourth day after a ECB policy maker said thefirst interest rate increasein the euro area could come some quarters, but not years after the bond buying program concludes.

Higher prices for the euro currency tended to pull up the value of the British pound.

The Canadian dollar and the Australian dollar are higher due to the increase in crude oil prices.

INTEREST RATE MARKET FUTURES

Futures are mixed to lower after Cleveland Federal Reserve Bank President Loretta Mester said the Federal Reserve should continue its gradual approach to increasing interest rates given that inflation has not reached the U.S. central bank's 2% goal in a sustained way.

The Federal Reserve is forecasting another two rate hikes this year, although an increasing number of policymakers see three more as a possibility.

St. Louis Federal Reserve Bank PresidentJames Bullardwill speak at 8:40 A.M.

The Federal Open Market Committee remains on track to deliver its second rate hike of the year when it meets next month.

The probability of a fed funds rate increase from the FOMC at the June 13 meeting is almost 100%, which is unchanged from Friday.

While a June interest rate hike from the Federal Reserve appears to be almost fully priced in, the probability of another rate hike in December stands at 91%.

Although some analysts are predicting three more interest rate hikes from the Fed this year, I am still anticipating only two more rate increases this year from the Federal Reserve; one in June and another in December.

SUPPORT AND RESISTANCE

June 18 S&P 500

Support 2725.00 Resistance 2743.00

June 18 U.S. Dollar Index

Support 92.020 Resistance 92.430

June 18 Euro Currency

Support 1.19660 Resistance 1.20310

June 18 Japanese Yen

Support .91410 Resistance .91830

June 18 Canadian Dollar

Support .78210 Resistance .78530

June 18 Australian Dollar

Support .7535 Resistance .7573

June 18 Thirty Year Treasury Bonds

Support 142^12 Resistance 143^16

June 18 Gold

Support 1316.0Resistance 1326.0

July 18 Copper

Support 3.0750 Resistance 3.1350

June 18 Crude Oil

Support 70.18 Resistance 71.31

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For more information about these markets, please contact Alan at 312.242.7911 or via email at alan.bush@admis.com. Thank you.

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About the author


Alan Bush has been a commodity analyst since 1976 focusing on the fundamental and technical aspects of stock index, interest rate and foreign currency markets. He has authored several articles for Stocks Futures and Options magazine and produced the “Futures Tech Focus” program, which is a technically based market outlook.

Alan served on the faculty of Oakton College as instructor of a course entitled, “Principles of Technical Analysis.” He has been interviewed on many national television programs, appearing on the Nightly Business Report, CNBC, CNN Moneyline, Reuters Television and Web FN. In addition, he has been frequently quoted in The Wall Street Journal, USA Today, The Bond Buyer and the Chicago Tribune and has been regularly interviewed on Chicago’s WMAQ radio business reports.

Alan can be reached at (312) 242-7911, or via email at alan.bush@admis.com.

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