• Bill Baruch

Morning Express


E-mini S&P (June)

Yesterday’s close: Settled at 2867.25, down 1.75 Fundamentals: U.S benchmarks are firm this morning, gaining ground across the board. The S&P traded to a seven and a half week high ahead of the bell yesterday but some of the largest stocks led a wave of profit taking ahead of earnings. The S&P returned all premarket gains and the NQ finished -1.2%. Who could blame investors and traders shoring up positions ahead of a treacherous economic calendar? As we noted here yesterday, the S&P has gained one third of its value since the depths of zero demand on March 23rd. Alphabet delivered a solid report after the bell yesterday and the stock has gained as much as 10% afterhours. Although earnings missed and revenues beat, one could argue a fear of dissipating ad revenue was already priced. Executives delivered the contrary, despite a sharp drop in ad revenue for March, this has not carried over into April. Furthermore, the company noted increased engagement during lockdowns across its software platforms. At $1330 premarket, the stock is at a critical technical level. Boeing, Mastercard, GE, Northrop Grumman and more report ahead of the bell this morning. After the close, we look to Microsoft, Facebook and Tesla. All three gave up ground yesterday but have been buoyed by the good news from. In between a slew of earnings, we have a jam-packed economic calendar. This morning we get the first look at Q1 GDP at 7:30 am CT. Although the bulk of the quarter only began to see a ripple effect from the start of the Coronavirus outbreak in China and lockdowns in the U.S did not begin until mid-March, the numbers are expected to shed some light on the damage. Expectations are for a contraction of 4.0% and Q2 is expected to be much worse. Pending Home Sales are due at 9:00 am CT and EIA Crude Inventories are released at 9:30. All eyes are on the Federal Reserve who concludes a two-day policy meeting at 1:00 pm CT. They are not expected to adjust interest rates and their statement should give some economic feedback. Investors and traders will be on the lookout for any clarity or modifications to the Fed’s QE and liquidity programs. However, its Fed Chair Powell’s press conference at 1:30 pm CT that is likely to be the main event and where we could get the most insight. Although it’s too early and the economic situation too uncertain for the Fed to plan an endgame or commit to any substantial dialing back of stimulus measures, an impossible task to imagine down the road, we will be on the lookout for any attempt to water-down their “whatever it takes” narrative. Remember, they have announced an unwind of some bond purchases already. Given that markets are stable and there is hope of normalization, any step forward today also gives them more rope upon a worsening situation. A seed planted now may be better fit than a seed planted further down that road. Technicals: Price action is consolidating higher after a very health hold of yesterday’s low close. Our momentum indicators align with other technicals to create our Pivots, levels that we view as a battleground through the open. Overhead resistance in the S&P aligns with the ... Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias and proprietary levels emailed directly.

Crude Oil (July) Yesterday’s close: Settled at 17.60, down 0.48 Fundamentals: Crude Oil has steadily moved higher through the night ahead of a deluge of data. Although Q1 GDP is a lagging number, it will paint a picture of some of the damage being felt. The elephant in the room though remains storage. Supporting prices are reports of some storage relief in Europe, however, we await the U.S EIA inventory data at 9:30 am CT and the move could also be credited to some shoring of positions ahead of the data. Last night’s private API survey was more or less in line with estimates; +9.978 mb Crude, -1.108 mb Gasoline, +5.462 mb Distillates and +2.486 mb at Cushing. Analyst estimates for today’s official report are +10.619 mb Crude, +2.527 mb Gasoline and +3.6 mb Distillates. Larger builds will again pressure prices. Technicals: Price action held major three-star support at 17.12-17.29 and responded into this morning. The tape is holding out above our momentum indicator at ...  Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias and proprietary levels emailed directly. Gold (June)

Yesterday’s close: Settled at 1722, down 1.6 Fundamentals: Gold washed out early and dampened our near-term bullish hopes, however, price action did recover quickly. Today will be pivotal with many narratives at play. U.S Q1 GDP is due at 7:30 am CT and the Federal Reserve concludes a two-day policy meeting at 1:00 pm CT, followed by Fed Chair Powell’s press conference at 1:30. The path of least resistance over the intermediate and long-term is still seen as unequivocally bullish. However, near-term expectations are fickle as seen by yesterday’s washout that could only be attributed to a physical rolling and settlement as well as a wave of weakness in equity markets. That’s right, Gold lost 1.5% in minutes maybe due to equity market weakness, this is nothing new but is an ever-present reminder of those many narratives at play; all will be out today. Technicals: What was minor resistance at 1728.9 is now viewed as a bit stronger given yesterday’s whiplash at the highs. Stronger resistance comes in at 1735.1-1735.6, however, both are key levels. Our momentum indicator comes in ...  Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias and proprietary levels emailed directly.

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