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Markets Pop Before The Bell

Published 08/14/2012, 01:49 AM
Updated 07/09/2023, 06:31 AM

Tuesday morning, the S&P 500 Index e-mini futures (ES-U2) are trading higher by 6.00 points to 1408.50 per contract. Traders and investors are cheering the markets higher this morning after Greece held a successful €4.063 bond auction. Market participants also seem to be reacting favorably to the U.S. economic data released at 8:30 am EST. All of this positive U.S. Data makes a near-term quantitative easing by the Federal Reserve less likely.

The bottom line, if the U.S. Dollar Index (DX-U2) starts to rally higher this small move higher in stocks could come to an abrupt end. The U.S. Dollar Index is still the most important chart that any trader can follow. As you should know by now, the stock market indexes around the world continue to trade inverse to the U.S. dollar.

Last night, the leading Asian stock indexes all traded higher. The important Shanghai Index (China) finished higher by just 0.30 percent. This tells us that the Chinese ADR's could be vulnerable to declines if the U.S. markets are weak. Leading stocks such as China Mobile Ltd. (ADR) (NYSE:CHL), SINA Corporation (NASDAQ:SINA), Baidu.com, Inc (NASDAQ:BIDU), and Sohu.com Inc (NASDAQ:SOHU) could all be very volatile this week.

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