Morning Express - stocks, oil and gold analysis

E-mini S&P (September)

Yesterday’s close: Settled at 3251.25, up 6.00

NQ, yesterday’s close: Settled at 10,851, down 100

Fundamentals: U.S. benchmarks surged from Monday’s opening bell into the second half of yesterday. The S&P achieved the highest level since February 24th and the NQ again notched 11,000 but failed to set a new high by half a point. Late session weakness though could be attributed to profit taking ahead of earnings, slower reopenings and deadlock in Washington among other rational reasons. Price action overnight battled U.S.-China tensions and rising Covid-19 cases globally to hold ground ahead of today’s open.

In Washington, Congress is deadlocked on new fiscal measures. The clock is running out on current support as the August recess nears. Senate Republicans are pushing for a $1 trillion plan that President Trump wants to include a payroll tax cut, whereas House Democrats are proposing a package with worth $3 trillion. Both parties seem far away and a watered-down version of each may become the lauded last-ditch effort.

There is deluge of earnings before and after the bell today. Investors gear up for reports from Microsoft, Tesla, Chipotle and Las Vegas Sands after the close.

U.S.-China tensions are back in the headlines after the U.S. closed China’s Houston consulate. The U.S. State Department confirmed the closure adding that it was done to protect intellectual property and private information. China has vowed to retaliate calling it an “unprecedented escalation”. There is video footage on Twitter showing open fires within the consulate assumed to be burning evidence of misdoings before the local police and fire department arrived.

Technicals: Price action from late yesterday has been unenthusiastic but not truly negative; after a steady two-day run, some air is coming out of the balloon. From a technical standpoint, the S&P did close at a higher high and this pullback has held major three-star support at 3226.25-3233.25. Yesterday’s late volatility broke below our rising momentum indicator briefly but not decisively as it ping-ponged last night. However, it finally did decisively break below our momentum indicator upon the wave of weakness around midnight; this now aligns with settlement and our previous resistance to create first key 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 (September)

Yesterday’s close: Settled at 41.92, up 1.00

Fundamentals: Crude Oil ripped higher early yesterday and essentially achieved covering the March 6th front month gap. Prices slipped from that 9:00 am CT peak at technical resistance ahead of inventory data and amid surging Covid-19 cases. After the bell, API data signaled what some must have feared; a much larger build than expected at +7.544 mb of Crude. Still, draws in both Gasoline and Distillates offset some of the headline build. Rising tensions between the U.S. and China after the U.S. State Department instructed them to close their Houston consulate are also weighing on the tape. The official EIA report is due at 9:30 am CT and analysts expect -2.088 mb Crude, -1.386 mb Gasoline and -0.618 mb Distillates. API’s headline Crude build certainly sets a bar.

Technicals: Price action was stopped in its tracks yesterday right at the March 6th gap, our major three-star resistance, at 42.64. Yesterday’s settlement was right at our Pivot and this still encompasses our momentum indicator. The wave of weakness has tested 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.

Gold (August)

Yesterday’s close: Settled at 1843.9, up 26.5

Fundamentals: We love Gooooold! But that does not mean one should waver from our ongoing narrative; “you do not want to chase Gold when everyone is screaming for it, this is when you want to capitalize on Gold you already own”. If one has done this, there have been great pullbacks and healthy technical construction to use as a buying opportunity. Ultimately, the U.S. Dollar has been crushed in recent days, weeks and months and this paves a path of least resistance higher for Gold amid ZIRP. Make no mistake though, the latest leg is being led by Silver’s surge. Silver was up almost $2 immediately in the overnight on strong volume as the Gold/Silver ratio has lost one third since its peak in March.

Bill Baruch joined CNBC’s Fast Money yesterday to discuss Gold.

Technicals: Price action ripped higher early last night and achieved our next upside target of 1868.5 (discussed here and in yesterday’s interview) before peeling back after failing a retest this morning. Our momentum indicator aligns with our previous resistance at 1849.1 and the bulls continue to hold the driver’s seat across all time frames above here. First key support comes in at 1837.8, but it is our 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.

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Bill Baruch



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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