Futures Update Week of Aug 1 Sun Night Open

News of a deal is sending risk trade higher. Equity futures, commodities, and commodity-related currencies are all rallying. We have one possible negative: Mrs. Pelosi & Co., but I think she just wants her say in the thing, as well as some spotlight back (after losing House speaker title). Come Monday afternoon or night, we will have a deal, and signed by President debt ceiling raise. I predicted it all a month ago, a race to the wire, eleventh hour fight, but a final outcome just had to be a deal. I said that all of this would weigh on equities in July. We did not lose 777 Dow points in one day, but we lost 670 points since July 7.  http://viewonmarkets.blogspot.com/2011/07/happy-independence-day-to-us-traders.html
Due to this circus in Washington, we now have a well-defined picture-perfect double top on Dow @ 12751 (on 7/21), which itself is a lower high compared to 5/2 high of 12876. This technical picture along with deteriorating economic conditions will put a question mark on a long-term rally. But rally nonetheless will happen, as we just broke out of a falling wedge on YM_F Dow futures I mentioned a few days ago http://viewonmarkets.blogspot.com/2011/07/spx-futures-technicals-esf.html. Give the rally a few days and about 350 points. Just to inflict maximum pain on shorts, longs may take the price above 50 dsma, but my view is the end comes at a 8/21/50 dema and 50% fib crossroads. Not a bad idea to be long to that point. Hey, all we traders do is ride the wave, after all. Trail your stops though, as u-turn could be fast and vicious.

Watch Chinese Mfg PMI report tonight. The only hope we have left is world economy rebounding, as ours is slowing down to a halt. Somehow I think that world economy is going to be a problem as well.

Update 1
Chinese Mfg PMI is out. Barely above 50. Saved by 0.7 of a point from contraction. Next important number is ISM Mfg PMI tomorrow morning.

Update 2
HSBC Chinese Mfg PMI out @ 49.3. Oops... Contraction is a number below 50.
Taiwan PMI out @ 46.1 - oops again.
Folks, are you getting the picture yet??