Morning Express

E-mini S&P (March)


Yesterday’s close: Settled at 3239.50, down 54.00


Fundamentals: U.S benchmarks are ping-ponging between technical levels. Investors and traders alike are showing caution awaiting further developments on the Coronavirus and it’s too soon to know the impact. We mentioned here yesterday that China accounted for one third of the world’s GDP in 2019; industrials, commodities and tech have all taken a hit due to the fear of demand interruptions. The death toll has now topped 100 and with more than 4,500 confirmed cases. The nation announced a travel ban to Hong Kong in the middle of the Lunar New Year. Given the holiday, regional markets have been closed and this has probably helped abate some potential panic.


Domestically, it is certainly not far reaching to believe some pressures in U.S benchmarks have been due to Democratic presidential candidate Bernie Sanders surging in the polls for the parties nomination as well as it becoming a bit more likely witnesses could be called in the impeachment trial of President Trump. We’ve said it here before and we will say it again; the stock market likes President Trump. Markets do not like uncertainty and things are less certain in Washington.

The economic and earnings calendars are jammed packed today. At a time with a cloud of uncertainty hanging over the manufacturing sector, Durable Goods is due at 7:30 am CT. Case Shiller Home Price Index is out at 8:00 am and a pivotal Consumer Confidence read follows at 9:00 am CT. Regional Fed Manufacturing surveys have been nothing to write home about and Richmond is out at 9:00 and followed Dallas Fed Services at 9:30.


On the earnings front 3M and Pfizer both missed estimates and are down nearly 2% premarket. United Technologies and Lockheed Martin each beat estimates. Although these are four big names among many others reporting before the bell, the big report is after the close with Apple. Starbucks, eBay, AMD and others are also due.


Technicals: Yesterday, we had a wide range of first key resistance in the S&P and this acted as a ceiling over the last 24 hours. We broke this out and major three-star resistance first comes in at ... Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias and proprietary levels emailed you each day.





Crude Oil (March)


Yesterday’s close: Settled at 53.14, down 1.05


Fundamentals: We believe the downside in energy has been exacerbated and began eluding to this technically yesterday as well as discussing some position options we believe opportunistic in Gasoline; feel free to call out trade desk to discuss 312-278-0500. The exacerbated sentiment was warranted; the Coronavirus hit right as the overdone Managed Money net-long position was relieving itself. Furthermore, China accounts for 25% of world energy demand (although we have seen estimates as low as 15%) and the uncertainty brewing could linger for days and weeks as the incubation period plays out. For now, we do know travel and thus demand has taken a significant hit as not only global growth but a potential Oil surplus in Q1 finds itself at an inflection point. Core Durable Goods today for December contracted by 0.1% when a flat number was expected, and November’s flat read was revised to -0.4%. Traders must keep a pulse on the broader risk-environment.


Inventory data comes into the picture and early estimates are for +0.46 mb Crude, +1.166 mb Gasoline and -1.25 mb Distillates. API is due at 3:30 pm CT.

Technicals: Price action is attempting a recovery but faces quite a few hurdles to repair such damage. Strong resistance comes in at Friday’s settlement and low and repair must begin with a close above here, anything less leaves this market vulnerable to ... Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias and proprietary levels emailed you each day.





Gold (April)


Yesterday’s close: Settled at 1583.7, up 5.5


Fundamentals: Gold slumped ahead of Durable Goods data as the risk-landscape began stabilizing early this morning. Durable Goods whiffed though, more in the numbers than the headlines. The Core read contracted in December when expected flat but more importantly that poor read was MoM from a terrible revision from flat to -0.4% in November. Consumer Confidence is on deck at 9:00 am CT and Richmond Manufacturing is expected to be a bright spot. Barring either number showing outlandish results, what it really comes down to is how that risk-landscape responds to Coronavirus, Bernie Sanders and impeachment in the headlines and how traders position ahead of tomorrow Fed meeting.


Technicals: Price action is battling above a crucial level at 1576-1578.2 and above here the bulls are in the driver’s seat. Our momentum indicator is starting to slump slightly, and the tape is below this level at ... Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias and proprietary levels emailed you each day.



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Futures trading involves substantial risk of loss and may not be suitable for all investors.