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SP 500 and Dow Futures at Record Highs

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July 12, 2019


S&P 500 and Dow futures advanced to record highs today on limited news. Much of the recent gains can be linked to Federal Reserve Chairman Jerome Powells congressional testimony earlier this week, which set the stage for the central bank to lower interest rates.

The June producer price index was up .1% as expected and the producer price index, excluding food and energy, advanced .3% when a gain of .2% was anticipated.

My view remains that the global reflation scenario is on track and easier credit conditions from most of the worlds central banks, including the Federal Reserve, are coming and will be the dominant fundamental that supports stock index futures in the long term.


The U.S. dollar index fell for a third day now that interest rate differential expectations have turned slightly bearish for the greenback in light of Fed Chair Powells dovish congressional testimony.

The Australian dollar showed little reaction to reports that Chinas exports dropped less than expected in June. China's exports were down 1.3% from a year earlier when a 2.0% decline was anticipated and imports fell 7.3% when down. 3.8% was estimated.

The Canadian dollar advanced due to rising crude oil prices, as oil production in the Gulf of Mexico has been reduced by Tropical Storm Barry that threatened the area.


Yesterdays 30 year Treasury bond auction was not well received.

There are no Fed speakers today.

Financial futures markets are predicting there is almost a 100% probability that the Federal Open Market Committee will lower its fed funds rate by 25 basis points or more at its July 30-31 policy meeting. A second rate cut is anticipated by financial futures markets later this year.

In the longer term, higher prices are likely for futures, as most major central banks are likely to embark on a new round of accommodation.


Futures appear to be building a symmetrical triangle congestion pattern on the daily chart. The rule of thumb is that prices come out of a congestion pattern in the same direction that they came into the pattern approximately 60% to 65% of the time.

Higher prices are likely for gold futures in the long term.


September 19S&P 500

Support 2998.00 Resistance 3017.00

September 19 U.S. Dollar Index

Support 96.440 Resistance 96.770

September 19Euro Currency

Support 1.12900 Resistance 1.13400

September 19Japanese Yen

Support .92430 Resistance .92980

September 19Canadian Dollar

Support .76550 Resistance .76970

September 19Australian Dollar

Support .6980 Resistance .7028

September 19 Thirty Year Treasury Bonds

Support 152^28 Resistance 154^0

August 19Gold

Support 1402.0 Resistance 1419.0

September 19Copper

Support 2.6700 Resistance 2.7200

August 19 Crude Oil

Support 59.73 Resistance 60.97

Contact Alan for more extensive information on these markets at 312.242.7911 or via email at Thank you.

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Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by Archer Daniels Midland Company. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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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

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