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Wall Street Fwd (Dec) $2 mini (Code: Dow Jones Futures) NEUTRAL


Wall Street Fwd (Dec) $2 mini TODAY
Opinion: Senators to the rescue? Price: 8709 MONITOR
Technical Points
Resistance
Major 2 8987
Minor 8920
Major 1 8852
Minor 8799
Gravitation 8746
Minor 8679
Major 1 8611
Minor 8558
Major 2 8505
Support
Analysis:
US stocks experienced a bumpy ride last night, finally finishing in positive territory with commodity prices firming across the board.

The Dow closed 70 points (+0.8%) stronger at 8761.

Oil stocks were some of the best performers following the rebound in oil prices. Chevron (+3.8%), and Exxon (+2.4%) fared well.

Elsewhere, GM was 2.1% weaker as talks continued regarding the bailout of the Big Three automakers.

After the market closed, the House approved a US$14 billion rescue plan, but the deal could still be scuppered by Senate Republicans.

Tonight’s session will see data releases on the US trade balance, unemployment claims, and import prices (all at 12:30am AEDT).

Likely Price Action:
The four-hour chart for Wall Street looks quite similar to the four-hour chart we featured for the AUD/USD in the midday report.

As for the Dow, previous resistance at 8637 has thus far acted as support and has already held the Dow twice this week.

This doesn’t necessarily mean the Dow will have another leg higher, however, as there is an immediate downtrend currently containing prices.

The Dow could yet fail at 8637, but we see the potential for speculative longs around 8600.

Longs entered at 8600 would have stops placed at least below 8500, with an initial target at 8800.

Anyone looking to enter the short suggestion for the AUD/USD should be aware that speculative longs on Wall Street should act as a quasi-hedge position.