Wednesday, June 15, 2016

Wednesday, June 15, 2016 Morning Comments by Michael Blythe @FairValueTrader

Wednesday, June 15, 2016 Morning Comments by Michael Blythe @FairValueTraderSocialTwist Tell-a-Friend

Good morning. The ESU6 bid higher overnight which is typical after three days of (relatively) noticeable selling and typical going into FOMC day two. It feels like the market has reached a line in the sand area and bulls need to hold 2050 or otherwise give up their control from a more macro point of view.

Note: I attached three charts showing  equity performance based on different factors that are current. All three of these suggest a bullish bias and this did not include June Quad Witch stats which are also bullish. I have noticed that when various analogs and statistics scream a consistent direction and that direction fails, the results can be severe. Meaning that if bulls drop the ball on this one, they may not get it back for a while.

The ESU6 is only up a modest four handles at the moment and it seems that if buyers cannot take charge at the open then it will be another sell rallies kind of day, and perhaps even, sell each new low. After bears have pushed the benchmark futures lower nearly 65 handles in a week’s time, bull ought to be able to mount a 20 handle rally at this, and this has yet to happen.

Levels I will be watching to the upside are 2073-2075 (**) area that bulls need to take early. Above that 2081 (*) and 2088 (**) come into play as resistance. To the downside, 2067 (**), 2063 (*) and 2055 (**) come in as support followed by 2048 (**)

It’s FOMC Day of course with the announcement coming at 1:00 om CST. While the probabilities of a June hike are virtually non existent the market will be paying close attention to the language used in the statement.

Michael Blythe
Futures Strategist 
Hamzei Analytics, LLC

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