Stock Indices: Bear Camp has the Edge to Start Today | RJO Futures

April 13, 2017 12:50PM CDT

US stocks are showing initial weakness and would seem to remain injured into the last session of this holidays shortened trading week, however we are surprised that the trade wasn’t able to benefit from a series of favorable Chinese economic developments overnight. We acknowledge the potential for lack of positive US data this morning and that might justify some of the weakness but traders need to be alert to the prospect of a major trend decision this morning off impending earnings news, especially since the markets came under initial pressure off JP Morgan results. There will be a big day for earnings announcements in the US financial sector with J.P. Morgan, Wells Fargo, Citigroup and PNC Financial reporting before the Wall Street opening.

S&P 500: Residual weakness in the markets to start today is clearly the result of the after effects of this week’s political and economic turmoil. However, one can’t discount the prospect that investors will remain disappointed in the prospect of pro-growth efforts in Washington. In fact, the odds of ongoing pro-growth policies seem to have been reduced with the best case scenario now calling for August or later timing. Some in the market are probably concerned that pro-growth policies might not see the light of data at all because of the Trump administration squandering of its political capital from just after the election. With the June E-Mini S&P this morning sitting right on this week’s low and a flurry of potentially critical financial sector earnings, traders should be poised to go with the earnings reaction. The failure to get positive earnings could set the stage for a big range down trade today. On the other hand, a recovery back above 2337.50 could elicit a week ending short covering balancing.

Today’s Market Idea: The overnight slide lower by June Mini S&P has started the expected downturn for the day, therefore voiding the recommendation.


Jun '17 Emini Daily Chart

RJO Futures | 222 South Riverside Plaza, Suite 1200 | Chicago, Illinois 60606 | United States
800.441.1616 | 312.373.5478

The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that RJO Futures believes to be reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgement at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades.

This material has been prepared by a sales or trading employee or agent of RJO Futures and is, or is in the nature of, a solicitation. This material is not a research report prepared by RJO Futures Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.

Distribution in some jurisdictions may be prohibited or restricted by law. Persons in possession of this communication indirectly should inform themselves about and observe any such prohibition or restrictions. To the extent that you have received this communication indirectly and solicitations are prohibited in your jurisdiction with registration, the market commentary in this communication should not be considered a solicitation.