Daily Futures Commentary June 29, 2009

U.S. financial and equity markets are trading steady to better overnight. Volume has been light but the ranges have been wide.

This week will see the end of the first half of 2009 as well as an early release of the June Unemployment Report. Expectations are for aggressive trading during the first 2 days of the week especially going into the end of the quarter. Trading could be light on Wednesday ahead of Thursday’s early June Non-Farm Payrolls Report, but there may be a huge drop-off in activity after the number because the markets will be closed on Friday.

September Treasury Bonds and Notes are called sharply higher. The Main Trend turned up in these markets last week following a well-received auction. With the supply pressure off these markets this week, look for the trend to continue until these two markets meet major retracement levels.

Equity futures are called steady to better. These markets are still in the retracement mode. This means the rally is likely to continue unless the September E-mini S&P 500 reaches the 918.50 to 926.50 range. End of the quarter window dressing is slowing down, but there is still a bias to the upside. Traders may have been pitching losing trades the last 10 days so they may be in a buying mood today.

Foreign currency trading has been extremely light overnight. The U.S. Dollar is weaker but volume is down. The September British Pound and September Euro are in a position to change their trends to up, but traders seem to be hesitant to put the high tick in because of the lack of fresh economic news.

Euro traders in particular are being careful around the 1.41 area and have been hesitant to make a commitment ahead of the European Central Bank meeting on July 2nd.

September British Pound traders have put this market in a position to breakout over 1.6600. The Bank of England does not meet until July 9th so traders may be a little more aggressive trading this market.

Precious metals are trading mixed. The trend turned up in August Gold last week but had very little follow-through. Inflation is not an issue at this time and this is keeping money on the sidelines. Gold and September Silver may move higher if the Dollar weakens.

The most activity is likely to be in the equities today. Look for buyers to try to push this market into key retracement areas in an effort to complete the current rally. Traders seem to be content with buying dips so do not expect too much of a rally once upside objectives have been met. Investors do not seem to be too interested in buying strength at this time.

Look for aggressive trading the first two days this week then for volatility and volume to drop off. This week is a short week so look for action on Monday and Tuesday.

Please do not hesitate to contact us at 1-800-971-2440, with any questions.

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