Tuesday October 19, 2010 - 13:32:25 GMT
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U.S. Stock Futures Called Lower on Heels of Apple, IBM News
stock index futures are expected to open lower on the heels of disappointing
news from Apple Computer, Inc. and IBM.
The indices started to feel pressure last night and never really recovered
as selling pressure continued overnight.
In the pre-market the December E-mini S&P is still
trading inside of its four day range of 1180.75 to 1162.50. Momentum is
building, however which may trigger an acceleration to the downside.
The strengthening U.S. Dollar is also putting pressure on
December Gold futures. Gold is currently making is largest correction from a
high in months. This overbalancing of price could be a sign of a major top.
Technically, three major uptrending Gann angles have been broken
indicating further weakness is likely. Downside momentum is building which
could take this market through the last swing bottom at $1325.60, changing the
main trend to down. The next downside target is a major 50% level at $1313.00.
The U.S. Dollar is posting strong gains this morning
following comments by Treasury Secretary Geithner. In a speech, Geithner
pledged that the Obama administration will not devalue the currency.
This morning the Dollar is trading higher, but still under
yesterdayâ€™s high. Watch for an acceleration to the upside if 77.86 gets taken
The British Pound is on the defensive as traders take
protection ahead of Wednesdayâ€™s release of minutes from the Bank of Englandâ€™s
latest monetary policy meeting. Long traders are paring positions on the notion
that the BoEâ€™s minutes may suggest further monetary easing.
The BoEâ€™s minutes are important because they will give
traders a good idea as to how close it is to announcing additional asset
purchases known as quantitative easing.
BoE members are also expected to express their concerns
about further government spending cuts. Some feel that the economy is too
fragile to handle additional cuts at this time, therefore putting the economy
in position to fall into another recession.
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