Morning Express | Actionable Proprietary Insights pre-Open by Bill Baruch | Stocks, Oil, & Gold

E-mini S&P (December)

Yesterday’s close: Settled at 3346, up 58.75

NQ, yesterday’s close: Settled at 11,394.75, up 258.25

Fundamentals: With tonight’s presidential debate in mind, U.S. benchmarks are peeling back from their overnight surge. With price action hovering around unchanged, we too think it’s smart to reduce risk ahead of tonight’s highly anticipated showdown between President Trump and Democrat candidate Joe Biden. Bringing a tailwind yesterday to what had already become a path of least resistance higher Friday was a glimmer of hope that Congress could set aside their differences and agree on a new fiscal bill. House Democrats are presenting a watered-down $2.2 trillion package that will be voted on in the coming days. The White House has said it could support a package as large as $1.5 trillion and the markets are eagerly awaiting comments from Treasury Secretary Mnuchin today as well as the topic being discussed tonight.

There is a deluge of Fed speakers on today’s schedule for the New York Fed’s Treasury Conference. First up is New York Fed President Williams at 8:15 am CT, followed by Philadelphia Fed President Harker at 8:30. Fed Vice Chair Clarida and Fed Governor Quarles will also be on tap throughout the day. Consumer Confidence is due at 9:00 am CT. We then look to Chinese Manufacturing tonight; the first read is at 8:00 pm CT followed by HSBC Caixin at 8:45 am CT.

Technicals: We are back to taking a Neutral approach in the near-term. Although our upside targets were not quite achieved, it has been a great snap back from last week’s weakness and traders should prepare accordingly ahead of tonight’s debate. Both the S&P and NQ traded higher early last night with the S&P stalling at key resistance at 3357-3363. Overhead, there is 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.

Crude Oil (November)

Yesterday’s close: Settled at 40.60, up 0.35

Fundamentals: Crude Oil again stalled at a key technical level, but this time on news confirming our ongoing theory that Saudi Arabia’s Energy Minister spoke harshly two weeks ago on fears of undercompliance. Data for September shows that Russian production is pressing 10 mbpd, up from 9.86 mbpd in August and 9.37 mbpd in July. This explains a lot and begs the question, who else may be slightly overproducing; a lot of little increases equals a large increase. Tonight’s debate will prove pivotal and Chinese Manufacturing data is also due. Early estimates on tomorrow’s inventory data, with API due after the bell, point to a draw of 2.35 mb, it would be the eighth in nine weeks.

Technicals: With a firm tape yesterday, our momentum indicator rose to 40.40 and is steady there this morning. Considering resistance at 40.30-40.51 and the ongoing struggle to follow through from a 40.60 settlement, the bears are quickly taking the driver’s seat on today’s session amid a developing failure. Still, first key support is 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.

Gold (December)

Yesterday’s close: Settled at 1882.3, up 16.0

Fundamentals: Gold has continued to edge higher amid U.S. Dollar weakness. Consumer Confidence surprised massively to the upside this morning at 101.8 versus 89.2 and this could throw near-term cold water over the Gold snap-back. Still, there is a slew of Fed speak in New York throughout the day; New York Fed President Williams, and Fed Governors Clarida and Quarles. Tonight’s presidential debate also begs to keep traders on their seats and the U.S. Dollar is crucial. Lastly, potential fiscal measures hang in the balance in Washington after House Democrats presented a watered-down $2.2 trillion package; positive developments will likely lead Gold higher given last week’s negative reaction.

Bill Baruch joined CNBC’s Halftime Show yesterday to lay out his trade in Gold.

Technicals: The tape remains firm but faces major three-star resistance overhead at 1901-1907; a close above here neutralizes last week’s immense weakness and invites fresh buying. Continued action above 1882.3-1884.5 helps support a constructive groundwork off yesterday’s double bottom versus last Thursday and outside bullish daily bar versus Friday....  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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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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