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Morning Express | Actionable fundamentals and technicals across asset classes by Bill Baruch

E-mini S&P (December)


Yesterday’s close: Settled at 3333.75, down 12.25


NQ, yesterday’s close: Settled at 11,337.75, down 57


Fundamentals: U.S. benchmarks are paring the week’s gains after a heated debate between President Trump and former Vice President Biden; we did not expect anything less. Yesterday, due to our uncertain outlook ahead of the showdown, we emphasized a very Neutral stance although our upside targets had not quite been achieved. Ultimately, we expect a continued choppy trade through the next two debates scheduled for October 15th and 22nd and heading into the election. However, there is an outlier, if Congress can agree on a bipartisan fiscal package. We believe the passing of fresh Coronavirus aid would lift risk assets and send both the S&P and NQ through their respective overhead technical resistance levels.

Jobs are also front and center this morning and through the end of the week. The private ADP Payroll survey printed a gain of 749,000 jobs in September, more than the 650,000 expected. This comes as Disney announced it will lay off 28,000 workers across its resorts, theme parks, cruise lines and retail due to constraints tied to Covid-19. Potential cuts from the airlines also lurks in the backgrounds. Shell also announced it will cut up to 9,000 jobs through the end of 2022 as the pandemic weighs on their industry.

Bill Baruch joined CNBC’s to discuss Target and Amazon holding dueling sales days next month.

Last night, Manufacturing data from China was mixed with the headline PMI read coming in at 51.5 versus 51.2 and the private HSBC survey coming in at 53.0 versus 53.1. From the U.S., the final print on Q2 GDP came in better than expected this morning at -31.4% versus -31.7% from the second preliminary read. Chicago PMI is up next at 8:45 am CT and followed by Pending Home Sales. ECB Executive Board member Lane speaks at 9:00 am CT. Minneapolis Fed President Kashkari speaks at 10:00 am CT, San Francisco Fed President Bowman follows at 12:40 pm CT and Dallas Fed President Kaplan is at 5:00 pm CT. Tomorrow, we look the Fed’s preferred inflation indicator, the Core PCE Index, and ISM Manufacturing. Nonfarm Payroll is out Friday.


Technicals: Last night’s weakness traded back near unchanged on the week in the S&P, however, a gap from Friday’s close and major three-star support at 3280.50-3287.25 linger as unfinished business. Although the NQ took out major three-star support at ... Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias, and proprietary levels emailed each morning.

Crude Oil (December)


Yesterday’s close: Settled at 39.29, down 1.31


Fundamentals: Crude Oil was hammered yesterday as our narrative came to light; the Saudi Energy Minister used harsh language two weeks ago to masquerade a fear of under-compliance. Data yesterday showed Russia producing near 10 mbpd, higher than August at 9.86. Our belief is they are not the only ones. Inventory data is front and center today and the tape has worked to pare losses despite an underwhelming read on the private API survey last night. However, first, hopes of stimulus from Washington and a slightly better read on ADP Payrolls and U.S. Q2 GDP than expected have lifted risk-assets from overnight lows ahead of the bell. API reported a smaller draw than expected for Crude at -0.831 mb and a surprise build of +1.623 mb of Gasoline. Regardless, the tape has been buoyed by the macro picture. Analysts now expect a build for Crude at +1.569 mb, -1.083 mb Gasoline and -0.917 mb Distillates. The data is due at 9:30 am CT.

Bill Baruch spoke with CNBC’s Trading Nation yesterday to discuss where he wants to buy Crude and energy stocks.


Technicals: Price action traded to a low of 38.41 yesterday and responded to major three-star support at 38.55-38.87 and set a higher low overnight. Our momentum indicator has slipped down to 39.22 and aligns with settlement from yesterday; continued action above here is ...  Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias, and proprietary levels emailed each morning.

Gold (December)


Yesterday’s close: Settled at 1903.2, up 20.9


Fundamentals: Gold is hanging tough after last week’s drop but is struggling to hold out above the psychological $1900 mark which happens to align with major three-star resistance. A weak tape overnight, along with risk-assets, responded to uplifting comments from House Speaker Pelosi that she is “hopeful” on new stimulus measures. The U.S. Dollar remains at a critical juncture and today some movement could be more heavily dependent on the Euro; ECB Executive Board Member Lane speaks at 9:00 am CT and there are reports out of Germany that the EU Recovery Fund, which lifted the Euro through the summer, is facing continued delays. Minneapolis Fed President Kashkari speaks at 10:00 am CT, San Francisco Fed President Bowman follows at 12:40 pm CT and Dallas Fed President Kaplan is at 5:00 pm CT. Tomorrow, we look the Fed’s preferred inflation indicator, the Core PCE Index, and ISM Manufacturing. Nonfarm Payroll is out Friday.


Technicals: Overnight, Gold slipped and held first key support at 1884.5 with a low of 1885.8. Although the tape responded with a surge of buying this morning, price action has again struggled to chew through major three-star resistance at ...  Please sign up for a Free Trial at Blue Line Futures to have our entire technical outlook, actionable bias, and proprietary levels 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.

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