Wednesday, June 29, 2016 #PreMarket Comments by Michael Blythe
Good morning. Another run higher for global equities last night that helped the ESU6 push up to 2043.50. The mini is now over 60 handles from Monday’s low and 2050 roughly marks the halfway point from last weeks’s high to Monday’s low. I have a difficult time assuming that equities will make a V-shape recovery and expect at least somewhat of a retest of this weeks lows (at some point) while forcing bulls to make a lower high on the daily chart. Having said this, I am still in a macro sell the rallies mode until 2050-2060 proves support. To me, the risk/reward looks favorable for some lotto type puts and I am starting to price week 1 and week 2 options.
Price levels to the downside are: 2032 (**) 2028 (**) 2023 (*) 2019(*) 2014 (***)
Upside prices: 2050 (**) 2054 (**) 2060 (**) and 2064 (***)
For me, 2041 is the pivotal price heading into the cash open and I lean to trading with whomever controls that area.
All the best;
Michael Blythe
Futures Strategist
Hamzei Analytics, LLC
