Day Trading Economic News Analysis: April 7, 2010

S&P 500 Pivots

The S&P 500 has been consistently trading upward since early February 2010. The trend on the daily chart has been consistently upward after breaking through the 1140 resistance level in early March.

The S&P 500 stayed above Monday’s primary pivot level of 1184.63 and broke through the previous high of 1187.73. Expect the S&P 500 to trade lower if the S&P 500 trades below 1183 and trades higher above 1192.

The market should stay above 1184 and 1186 Monday’s trading range since it seems it has consolidated around that area. Wednesday’s primary pivot level is 1188.00. Tuesday’s previous high is 1192 so there will be resistance at that level.

Summary of pivot levels:

1192: Tuesday’s previous high

1188: Wednesday’s primary pivot

1187: Monday’s previous high

1184 - 1186: 144 and 200 Fibonacci moving averages on 5 min chart

1183: Tuesday’s previous low

1181: Last Thursday’s previous high and previous convergence of 144 and 200 Fibonacci moving averages on 5 min chart

Commodities Analysis: Gold and Crude

Gold gain $1 to 1135 as gold imports are up in India ahead of the one million weddings planned between April and May. On the daily chart gold has been trending sideways since it reached a high of 1220 back in early December 2009. A trading strategy for gold includes buying calls on SPDR Gold Trust (ETF: GLD).

Crude oil jumped $0.11 to $86.73. The dollar lost ground played apart in pushing the commodities sector higher however yesterday the dollar gained against the euro. If the dollar continues to trend higher against the euro then expect prices in crude oil to fall.

Previously the OPEC cartel announced that it will keep oil output ceiling unchanged as it will keep its profit from the falling dollar. Oil was currently trading sideways between the $80 and $81 however it has regained its footing reinforcing OPEC's decision of keeping oil output the same.

Forex Analysis: Dollar Vs Euro

The euro fell against the dollar as concern about whether Greece will be able to finance its debt. Previously the dollar was declining as the European manufacturing sector was picking up pace with the global economy. On the weekly chart the Euro is trending lower against the dollar.

GE is investing 340 million Euros ($460 million) to expand European wind operations. Companies buying into foreign currencies for purchases and investing increase the demand towards that country’s currency. However the euro gains are being cut short as Greece struggles with issues on their debt.

Disclaimer

The content in this website is provided for educational and informational purposes only. We offer no investment advice, and nothing in this material should be construed as such. There is a risk of loss when you invest; past performance is never a guarantee of future performance. Trading is the sole responsibility of the individual. No reader should act on the basis of any matter contained herein without getting appropriate professional advice. Every investor or trader should consider all advice and all offerings of products and services on their own merits and for suitability to the individual's personal needs and circumstances.

All Right Reserved TraderMongers.com © 2010