To Lockdown Or Not? | Morning Express


Russell 2000 weekly, back-testing bull-flag breakout.



Crude daily, sell-off coming into strong support



Yes, again. U.S. 30-year yield consolidation. Inverse of futures price.



30-year Bond futures overhead resistance. Correlates with yield support.



- We have been highlighting rising Covid cases across Europe. Risk-assets turned sharply lower early this morning after Austria announced a full lockdown and Germany’s health minister wouldn’t rule it out. Germany is the union’s largest economy. Cases rose by a record 68k on Wednesday and the 7-day moving average at 45k matches the previous single day record from back in January.


- Euro trading below 1.13 and Dollar Index above 96, for the first time since July 2020 (outside of spike Tuesday night). Euro Stoxx -1% and DAX -0.6%


- House is expected to vote today on President Biden’s $2 trillion social spending bill.


- 30-year Bond futures rip to highest since Friday on lockdown news. Yield back to critical 1.90% and unchanged on the week after rallying to a high of 2.048%.


- Comments from Fed Governor Waller at 9:45 am CT and Fed Vice-Chair Clarida due at 11:15 am. Come after more hawkish comments from permanent voting NY Fed President Williams yesterday.


- Probability of a Fed hike by June still at 53.3%.


- Fresh record highs overnight in the S&P and NQ. However, S&P has retreated almost 1% from high of 4723.


- Energy, Materials and Financials will be the hardest hit sectors as lockdown stocks and Tech take the lead.


- Cyclical heavy Russell 2000 down 3.3% on the week and back-testing trend line. Shown in chart above.


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

S&P, yesterday’s close: Settled at 4701.50, up 15.25


NQ, yesterday’s close: Settled at 16,481.25, up 169.75


- Tech continues to lead higher, as we have been discussing. NQ never turned red after lockdown news. New floor developing at 16,392-16,449?


- With S&P reversal from fresh record, technical landscape very similar to yesterday with Pivot and point of balance at 4692.50.


- Momentum indicator is now overhead and aligning at 4701-4705; a decisive move back above here on the session would likely have legs.


- Strong first key support at 4684.75-4685.50; price action responding to this so far.


- Bulls in the driver’s seat across all timeframes until break below major three-star support at ... Click here to get our (FULL) daily reports emailed to you!

Bias:

Resistance:

Pivot:

Support:

NQ (December)

Resistance:

Pivot:

Support:


Crude Oil (January)


Yesterday’s close: Settled at 78.41, up 0.86


- We have been extremely cautious the energy sector of late, explicitly detailing headwinds from rising Covid cases and the White House. Furthering that positioning with patience into rare major four-star support at 74.96-75.12 should prove to be a great long-term buy.


- We have maintained a more Bullish Bias due to the strength of the uptrend and our longer-term upside expectations.


- Rally from yesterday failed perfectly at major three-star resistance at... Click here to get our (FULL) daily reports emailed to you!

Bias:

Resistance:

Pivot:

Support:


Gold (December) / Silver (December)


Gold, yesterday’s close: Settled at 1870.2, up 16.1


Silver, yesterday’s close: Settled at 25.167, up 0.223


- Gold and Silver holding a bid on safe haven tailwinds from lockdowns. However, U.S. Dollar strength a headwind.


- Consolidation has been very impressive this week


- However, continued action below our momentum indicators, detailed below, will allow for sellers to press into strong levels of support.


- A close above key resistance at ...Click here to get our (FULL) daily reports emailed to you!

Bias:

Resistance:

Pivot:

Support:

Silver (December)

Resistance:

Pivot: