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Monday 30th of September Market Report

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Monday 30th of September 2013 as of 14:00 CET

It is all about risk off this morning as the countdown to a potential “shutdown “in Washington is on, with about 16 hours to go at the time of writing.

The equity markets pretty much didn’t pay much attention to a potential shut down until at the very end of the week, but with no solution over the weekend it now looks much more likely. We can still get a last minute solution, but then we have probably more political mess when the debt ceiling debate starts in a bit over a week. A partial closing of the government could cost about $8bln each day, so a short term shutdown would have a limited impact.

Credit default swaps have started to move up on the US as well, which is not a good thing.

S&P500 futures are now trading at 1671 at the time of writing, which is below the key support at 1680 and the high on the Fed announcement looks like a major high potential now.  

Chinese data on the manufacturing came in softer than anticipated, coming in at 50.2 vs. expectations of 51.2.

Asian equity markets ex China traded mostly lower overnight Nikkei 225 down 2.06%, Shanghai up 0.59% and S&P/ASX 200 down 1.66%.

In Europe we have plenty of turmoil as well in Italy with Berlusconi pulling out his representatives from the Government, which could lead to new elections.

Full earnings calendar can be found here at Bloomberg: http://www.bloomberg.com/apps/ecal?c=US

VIX will spike higher at the open and I would not be surprised to see a run well past 18 and maybe towards 20.

Technicals

Market

S&P 500 emini (ES)

Dax

Crude

Corn

Eur/Usd

Res 3

1702

8727

105.59

470

1.3738

Res 2

1697

8696

105.13

464

1.3674

Res 1

1683

8612

104.06

459

1.3570

Sup1

1671

8553

102.36

450

1.3460

Sup 2

1665

8528

102.20

447

1.3223

Sup 3

1662

8456

101.46

440

1.3163

ATM calls Vols. nearby month

16

17

21.13

30.89

7.73

100 EMA

1640

8275

100.03

497

1.3150

200 EMA

1589

8068

97.94

528

1.3073

14 Day avg. Volume

1290K

75K

165K

85K

185K

S&P 500 Emini futures – Key support at 1665 which is an open gap that I am looking to be filled near term.  The break below 1680 overnight signals we could easily be on the way towards 1600. A move above 1683 resistance would give the power back to the bulls.

Dax futures – Looking for a move down to fill the open gap at 8528, which should provide some support if hit. Key resistance at 8612 today and I expect this to hold for the rest of the day. If the 8612 resistance is taken out then we are heading for 8640-50 area.

Corn –  Rolled to the December contract and we have good support around the 454 level and as long as this level holds there is potential for a move higher. If 454 is broken, the key support at 429 is within reach.

Crude – Going lower and lower over the last week and there is rising support at 101.40, which needs to hold today to avoid a sell off to 98.40.

Euro – A daily close above 1.3550 would confirm a break out, which would target 1.3738 next. Another failure up at the 1.3550 area would be quite bearish at this point and then a test of 1.3460 key support would come back into focus.

 

Today’s Economic Calendar (CET):

15:45     Chicago PMI (54.5)

 

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Risk Warning:  

Any information in this report is based on data considered to be reliable, but no representations or guarantees are made by KBR Capital Partners AS with regard to the accuracy of the data. This information is provided on condition that we accept no responsibility, legal or other for its contents. We, including our directors, officers, employees or publishers, disclaim all liabilities. Any statement constitutes only current opinions, which are subject to change. Neither the information nor any opinion expressed shall be construed to be, or constitute an offer to sell or a solicitation of an offer to buy any investments mentioned herein. Prices can go down as well as up. There is a significant risk involved in derivatives trading, including the risk of loss greater than the original investment. Past performance is no guarantee of future results.Conditions can vary from client to client, and therefore influence performance. The opportunity for profit creates a corresponding risk of loss. Anyone wishing to invest in any of the products mentioned should seek their own financial or professional advice.

 

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