What are the Market's Expectations? | Equities, Metals, and Energies | Morning Express
E-mini S&P (December)
Yesterday’s close: Settled at 3667.25, up 6.75
NQ, yesterday’s close: Settled at 12,454.25, up 2.00
Fundamentals: U.S. benchmarks are stable ahead of Jobless Claims and ISM Services data after battling for a healthy close yesterday. The best of the vaccine tailwinds may be in the rear-view mirror, but the continued news trickle is certainly keeping sentiment upbeat. Furthermore, markets are enjoying the reinvigoration of Coronavirus Aid talks in Washington despite the price tag being slashed in half. The two narratives are certainly working together to keep buyers satisfied and U.S. benchmarks on the verge of their next fortified breakout.
Retail Sales from the Eurozone was a pleasant surprise this morning and PMI data from both the Eurozone and U.K. also came in better. We now look to U.S. weekly Jobless Claims, a number that has stalled in the recent weeks but still shows tremendous progress from the onset of the pandemic. However, it is no secret that without fresh stimulus from Washington the jobs picture will erode. Tomorrow brings November Nonfarm Payrolls. Final November Services PMI is due at 8:45 am CT today and followed by the more closely watched ISM Services read at 9:00. Although Manufacturing was solid earlier in the week, it was a touch below expectations. A miss today will catch headlines and could weigh on sentiment ahead of jobs tomorrow.
Technicals: Not much has changed day to day with the technical landscape, it remains robustly healthy. The only significant shift from yesterday is positive; price action in each the S&P and NQ has been back above our momentum indicator since late yesterday morning. Today, these levels come in as our Pivots and essentially align closely with previous record highs; continued action at and above here is very bullish and builds for a broad fortified breakout. To the downside, yesterday’s weakness was met extremely well with buying and this is as healthy as it gets. First key support in the S&P at 3640 held, but there is still ... 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 (January)
Yesterday’s close: Settled at 45.28, up 0.73
Fundamentals: Crude Oil quickly regained ground yesterday morning as it seemed OPEC+ made positive strides and the headline Crude data was not as bearish as API the evening before. Most importantly, the cartel avoided talks breaking down and at the onset of U.S. hours today it appears OPEC+ will agree to extended production cuts without a taper until February. To appease all sides, they are discussing a planned addition of 500,000 bpd, but not until February. Ultimately, this is smart decision as too many uncertainties persist into January despite the higher prices. In fact, the market would likely not digest a production increase well and could have seen it as a shock extrapolated as a more aggressive measure into the first half of next year. Overall, a fully breakdown in the U.S. Dollar, stronger than expected data out of China this week, and healthy reads from the Eurozone this morning have buoyed the tape as we now look to the U.S. jobs picture.
Technicals: Yesterday, we discussed caution given the potential of mounting uncertainties amid OPEC+. However, there is no denying the extremely bullish technical landscape and building bull-flag pattern. For this reason, into yesterday’s rally, we have looked to defined-risk call spreads out to February in order to capture a potential breakout towards the psychological $50 mark. All in all, the continued healthy action at and above major three-star support 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.
Yesterday’s close: Settled at 1830.2, up 11.3
Fundamentals: The rebound continues, but Gold is now back to the scene of the crime and the need for risk-management is undeniable. If you have followed the scripted washout and foreseen recovery, then be smart and reduce your exposure against rare major four-star resistance at 1843-1854. The first glimpse of U.S. Jobless Claims (coming out right now) is better than expected. Services data is on deck with final November PMI at 8:45 am CT and then ISM at 9:00. Tomorrow brings November Nonfarm Payrolls and this coupled with ongoing stimulus talks in Washington has the U.S. Dollar in the spotlight. The rebalanced market profile after the December expirations and a full-on breakdown in the U.S. Dollar have together rallied Gold $80 or 4.5%.
Technicals: Gold has steadfastly held out above our momentum indicator since late Monday and this has allowed for the exhaustion to the downside to rebound north. We call it downside exhaustion because of the massive amount of damage done. This has brought Gold back to what is still a rare major four-star level, but now resistance, at 1843-1854. We do not envision Gold getting out above here today. If it does, then terrific, but as traders we cannot plan on hope; hope is not a risk-management strategy. The 200-day moving average comes in at 1820. Upon a move through our momentum indicator this morning 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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