The Risk Landscape Focuses on CPI, Earnings, FOMC Minutes | Morning Express

E-mini S&P (December) / NQ (December)

S&P, yesterday’s close: Settled at 4340.75, down 10.25


NQ, yesterday’s close: Settled at 14,653.25, down 47.25


Fundamentals: U.S. benchmarks slipped in the final hour again yesterday but found stable footing through the European open overnight. Fears of slowing growth due to consumer spending and supply chain disruptions has continued to weigh on sentiment. Yesterday, Apple cut the production target of its new iPhone 13 due to component shortages from Broadcom and Texas Instruments. This morning, analysts cut their 2021 German growth forecast from 3.7% to 2.4%. Although Eurozone Industrial Production beat expectations YoY this morning, it slipped by an expected 1.6% MoM as carmakers were hit hard by chip shortages. On a positive note, Chinese Trade Balance data last night printed strong Exports which exudes robust global demand. Fears of stagflation are front and center with today’s U.S. Core CPI data for September due at 7:30 am CT. Last year, inflation surged through August due to reopenings and was steady in September. Similarly, inflation surged from April through July this year. Today’s read, from both a year-to-year and month-to-month perspective has high base comparisons. Therefore, inflation is expected to appear tamer at +4.0% YoY and +0.2% MoM. Market participants must pay close attention to today’s results as it might give a clue to pressures the Federal Reserve faces in announcing a taper.


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The U.S. Treasury auctions $24 billion 30-years at noon CT and the Minutes from the Federal Reserve’s September meeting are due at 1:00 pm CT.

JPMorgan, Blackrock, and Delta kicked off earnings season this morning. Blackrock beat top and bottom expectations and is up nearly 2% ahead of the bell. JPMorgan is higher after topping earnings estimates but it did miss revenues. Delta beat top and bottom estimates, but the stock is down more than 1% as rising fuel costs cloud its outlook.


Technicals: Price action has remained very rangebound. After the S&P settled at key support at 4340-4344.50, it slipped further into the electronic close to again test and hold major three-star support at 4316.50-4321.75. The rebound is back above our momentum indicator, which now aligns with that 4340-4344.50 pocket as today’s Pivot and point of balance. Yesterday, key resistance at 4362.25-4365 kept rally attempts in check through the entire session and will be a critical area that the bulls must take the tape above in order to invite fresh buying. Similarly, the NQ was slammed late but held major three-star support at 14,567-14,583 again through the overnight. It is now trading above first key support that aligns with our momentum indicator at ... Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.


Crude Oil (November)

Yesterday’s close: Settled at 80.64, up 0.12

Fundamentals: Crude Oil continues to flirt with the $80 mark, digesting recent gains in the face of U.S. Dollar strength. Weighing on the tape is China demand. Last night, China’s Trade Balance data showed Crude Oil imports fell below 10 mpbd to 9.99 mbpd, a 15% decline YoY and nearly a 5% decline MoM. However, Natural Gas imports rose to a nine-month high. While global Gas demand is helping underpin the energy complex ahead of winter, fears of stagflation and an elevated U.S. Dollar are working to offset that strength. Headline CPI was higher than expected and the U.S. Dollar strengthened. Russia said this morning Gas exports to Europe will be available after November 1st, when the country completes preparations for its own heating. Russian President Putin was also in the news saying Crude Oil could go to $100.


Technicals: Prices are consolidating, and this is healthy. Early weakness yesterday traded down to 79.47 and key support at 79.35, clearing out weak longs, before ripping to a high of 81.62 and slipping form there. This helps define a range and within that range is our Pivot aligning with our momentum indicator at ... Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.

Gold (December) / Silver (December)

Gold, yesterday’s close: Settled at 1759.3, up 3.6


Silver, yesterday’s close: Settled at 22.514, down 0.151


Fundamentals: Gold and Silver have again left the bull camp disappointed. The precious metals complex traded higher early this morning with Gold retesting the 50-day moving average at a high of 1778.5. U.S. Core CPI was in line with expectations, but the more volatility headline number that includes food and energy, topped expectations by a tenth. In reaction, the U.S. Dollar rebounded to session highs and the Treasury market sank. In result, Gold parred all its session gain of 1% back to unchanged. The day is just getting started as the U.S. Treasury auctions $24 billion 30-years at noon CT and we look to the Minutes from the Federal Reserve’s September meeting at 1:00 pm CT; rates and Dollar will be front and center, therefore pushing and pulling Gold.


Technicals: Despite another reversal from major three-star resistance at 1780-1784, Gold is attempting to build a higher low. We do remain cautiously Bullish in Bias at these levels and given some construction in building higher lows. We must see Gold hold key support at 1751.7-1753 today, and ideally battle to spend the rest of the session above our Pivot and momentum indicator at ... Sign up for a Free Trial at Blue Line Futures to have our entire fundamental and technical outlook, actionable bias, and proprietary levels for the markets you trade emailed each morning.

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