E-mini S&P (March)
Yesterday’s close: Settled at 3677.25, down 8.50
NQ, yesterday’s close: Settled at 12,710, up 26.50
Fundamentals: U.S. benchmarks have again rebounded from a swift bat with volatility. Last night, President Trump tweeted a video criticizing the inept 5,000-page fiscal bill that Congress passed and sent to his desk, refusing to sign it until more was done for American citizens. Let it be known that every bill Congress passes has a number of egregious line items that have nothing to do with the bill at hand; that is what these lawmakers do, waste countless hours to line their pockets with support from lobbyists and special interest groups. Good for President Trump to call out what has become a mockery of those in dire need. Congress has worked for seven months to iron out a follow-up to The Heroes Act, a $3 trillion stimulus package passed in May. With lockdowns and restrictions forcing many out of work for nearly a year, it is an insult to those in need it has taken seven months to reach a deal that provides only $600 to individuals and falls short on many fronts, especially when compared to what other governments have done. The package set aside $284 billion for small businesses by refunding PPP, however, gave nothing to small and local governments when sending hundreds of millions to countries like Sudan and Cambodia. We get it, the U.S. needs to be a big brother, furthermore, help solidifying supply chains and stable governments, but not after seven months of pathetic negotiations between cronies who have been in office for decades.
We digress. President Trump is calling for $2,000 checks to American citizens and many lawmakers have already voiced support. Markets are doing what markets do, pricing in mounting expectations. Last night’s shock sent all U.S. benchmarks down by nearly 1%, but those expectations have now lifted the tape, setting it on a path to record highs if Congress can get momentum behind fresh legislation quickly.
On today’s economic calendar, we look to weekly Jobless Claims at 7:30 am CT along with Core PCI data, the Federal Reserve’s preferred inflation indicator. The headline read is accompanied by Personal Spending and Income data. Fresh December Michigan Consumer data and November New Home Sales are due at 9:00 am CT.
Technicals: Price action is playing out exactly as we would expect given our cautious narrative. Still, make no mistake, the market is in a viciously strong uptrend and the path of least resistance remains higher. In recent reports we have given our longer-term S&P targets, if you have questions as to what that is, please call our trade desk at 312-278-0500. Yesterday, we pointed to a ceiling of resistance that both the S&P and NQ must close out above in order to set wheels in motion for fresh record highs and our intermediate-term upside targets of ... Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.
Crude Oil (February)
Yesterday’s close: Settled at 47.02, down 0.95
Fundamentals: Crude Oil continues a magnificent battle to hold higher prices in the face of mixed narratives. Last night, the private API survey showed a surprise build of 2.7 mb of Crude when a draw of more than 3 mb was expected by analysts. Markets are less focused on the private survey though as it catches up to the massive surprise build of 15.189 mb two weeks ago on the official report. Today’s expectations for which are -3.186 mb of Crude, +1.21 mb Gasoline and -0.904 mb Distillates. Remember, amid U.S. Dollar weakness, we are looking for Exports to remain steady to higher and this coupled with strong U.S. demand will drawdown inventories. We remain bullish Crude over the intermediate to long-run, but our Bias is more Neutral as we await a better point of value.
President Trump refused to sign the fiscal package passed by Congress. Although this set markets back early last night and Crude traded to a nine-day low, expectations for Congress to do more have now helped solidify a rebound ahead of U.S. hours. Bringing support though is the reopening of the U.K. border after it was closed due to the new strand of Covid-19.
Technicals: Price action has rebounded from last night’s weakness and is holding out above our momentum indicator at 46.91 since 3:30 am CT. There is clear headwind this week at first key resistance at 47.88-48.16. With today having a much more fundamental focus, we will look to continued action above or below our Pivot as alluding to near-term momentum. We want to be buyers into ... Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.
Yesterday’s close: Settled at 1870.3, down 12.5
Silver, yesterday’s close: Settled at 25.535, down 0.844
Fundamentals: Gold and Silver are have moved well off their overnight lows as the U.S. Dollar gets hammered on reports that a Brexit deal is essentially achieved. Yesterday, Bill Baruch put out a video discussing the seasonally bullish time of year for precious metals. However, we noted headwinds in the very near-term as the U.S. Dollar works off oversold conditions. There is no better way to start off the seasonal trade than if currencies priced against the Dollar can find their own strength. Economic data this morning was mixed, and this could be looked to support the metals complex as well. Core PCE, the Federal Reserve’s preferred inflation indicator, came in below expectations. Also, Personal Income and Spending components missed along with Durable Goods data. However, weekly Jobless Claims were better. Overall, we are seeing a positively evolving landscape for Gold, Silver, and Platinum this morning.
Technicals: Given that we are headfirst into the bullish seasonal trade, we are increasing our Bullish Bias back to where it was when our near-term upside target of 1915 in Gold and 27.12-26.28 in Silver were achieved. Today’s session lows in each Gold and Silver held out above Monday’s whipsaw low, laying groundwork for construction today and bullish price action thereafter. For Gold, our momentum indicator comes in at 1871 and for Silver at 25.60; these will provide a definitive level that today’s price action must decisively stay above to lay that aforementioned groundwork.... Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.
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Blue Line Futures 312-278-0500 info@Bluelinefutures.com Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.