Preholiday Trading

The Light Crude Continuous Contract closed at $ 66.13 a barrel on Friday , after hitting an all - time high at $ 67.95 a barrel earlier in the day . A week from Monday is Labor Day , which marks the end of the summer driving season marks . Therefore I believe oil hit a short term top Friday or next week above .

Recent economic data show continued high oil prices , together with higher interest rates , a drag on U.S. economic growth . Orders for durable goods fell about 5 % last month , and Walmart announced sales will be lower than expected . However , business inventories are lean . A slower economy will reduce demand for oil .

The SPX daily chart below shows an orderly pullback in August. Currently, SPX oversold bounce in the Labor Day holiday. Enough Major support is around 1200 , ie the 200 day MA , and price - per - Volume bar . There are several major resistance levels to work to create a strong resistance together ie 10 , 20 , and 50 day MA , the Parabolic SAR sell signal ( red dots ) , and the price - per - Volume bar, all between 1220 and 1225.

There is usually a bullish bias of the week for a vacation, and then the first few days of a new month . However, the market is selling at the weekend (and the rally from last week) , that's bear market behavior , it is a seasonally weak period , and SPX has opened gaps in 1174 , 1143 and 1138. Oil prices and economic data , the market is moving .

There are many important economic reports next week , where a large part of the volatility should generate , in the season low market volume : Ma: No , di : Factory Orders, consumer confidence , and FOMC Minutes , Wed: Revised Q2 GDP and GDP Chain Price deflator and Chicago PMI . Do : Personal Income , Personal Spending , Unemployment Claims , Construction Spending , ISM Index and Auto Sales . Fri : Non - Farm Payrolls , Unemployment and labor .

The Dow Industrials were recently severely affected by high oil prices , and closed below 10,400 Friday , while the Nasdaq pretty well held. If oil prices above next week , DIA calls ( and put on some oil ) can buy on pullbacks . There are also several Dow components that were recently hit particularly hard .

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Arthur Albert Eckart is the founder and owner of Peak Trader . Arthur has worked for commercial banks , eg Wells Fargo , Banc One, and First Commerce Technologies , during the 1980s and 1990s . He has also worked for Janus Funds 1999-00 . Arthur Eckart has a BA and MA in Economics from the University of Colorado . He has worked on options portfolio optimization since 1998 .

Mr Eckart has to maximize a comprehensive trading methodology using economics , portfolio optimization , and technical analysis and minimizing risks developed at the same time . This methodology has resulted in excellent returns with low risk over the past four years .